Saturday, 23 January 2016

Time and money

Since taking a big pay cut a little over a year ago, I've been keeping track of my spending much more closely.

After tax, rent and bills, I have about £7k left per year. That's about £20 a day, and £20 a day is how I think of it when I'm budgeting. Every day I wake up and add £20 to the running total of what I've saved - or subtract that amount from my arrears. Then throughout the day I subtract whatever I spend.
There are alternatives. I could do just one addition on January 1st and only subtractions for the next 365 days. But that would be hard to benchmark: I'd have to keep calculating how much I should have left at this time of year so that I could hold it up against what I actually had. It would also be depressing to watch my total do nothing but shrink for a whole year.

Or I could keep a running total like I do now, but add 83p every hour. That would be pretty labour-intensive though, and I'd be constantly forgetting my total.

So what I do is probably what most people in my position do. But there are consequences.

For example, for the most part I try to keep within my daily budget, only really letting that slide if I'm drinking. (Alcohol is so expensive it would be impossible to keep within my budget and stay out more than a couple of hours, so the budget goes out the window in favour of a vague attempt at not going TOO overboard.)

That means I tend to only buy things that cost about £12 or less - about the amount I have left per day after food and incidentals. Sensible you might think for someone without much money, but somewhat irrational given that I could equally well think of myself as having £40 for every 48 hours, or £140 for every week, the latter of which might make me feel free to buy anything up to about £80 so long as I bought nothing else non-essential that week. I could live like a monk for six and a half days, then splurge like a tourist in one orgiastic evening.

If I thought of myself as having 83p an hour, would I limit myself to frivolous purchases of only about 50p at a time - like cans of Coke and Kinder eggs? If by the minute, penny sweets?

If I lived by the year, would it be a big holiday?

By the lifetime, a car?

I don't know. I live by the day, so I spend my money on books, exhibitions and the occasional cake. I don't take holidays and I dress only in Christmas presents. I'm usually home by five on a Saturday.

How was your day?