FOOL'S EYE VIEW
Living by the Book – The Final Lap

By Jane Mack (TMFJane)
October 26, 2001

After a month of writing down every single penny of expenditure, Katherine has finally got a full record of where she spent her money throughout September. And the result? Well, she spent £213 more than her monthly pay cheque of £1330!

She's already consolidated one set of debts into a loan of more than £3,000 and should really apply the brakes pretty quickly so she doesn't run up further debts in the meantime.

Most of her overspending has been on one-off items such as the fees and items for the Diploma course she's about to start (£150) and the dining room chairs (£50). These should, of course, have been budgeted for but at least these expenses won't be cropping up again. I'm a bit disapproving about the £55 spent towards the end of the month on a jumper and cardigan. I'm sure she's got enough clothes in wardrobe to last until she's actually got the money to buy such things!

The main areas where she can save money are clearly by bringing her breakfast and lunch from home. Barely a day went by when she wasn't nipping into the local shop to get herself a sandwich, a coke or some sweets and, as we pointed out in a previous article, it would much cheaper to plan ahead and buy these things from the supermarket.

And perhaps she should share a bottle of wine with friends at home instead of buying all those rounds in the pub. When spread over the month, her spending on her social life is far from excessive but in view of the larger one-off expenses for her Diploma course, she should have been more frugal throughout September.

We've already talked about the consolidation loan, which has a whopping interest rate of 19.9%. If Katherine could get a cheaper loan it could save her as much as £20 or £30 a month and, if she learns to live within her means while the loan is being paid off, she'll eventually be in a position to use that monthly outgoing to start saving for the future.

I guess the last word should go to Katherine really, She's been a real trooper by keeping a spending diary. It's not always easy to remember to write everything down, especially when the numbers induce a feeling of guilt. But it does appear she's learned from the experience:

Thank God it's my last week of this. Part of me is just fed up of writing every tiny amount that I spend down and another part of me is looking forward to the end so I can see where my money goes and let Jane analyse it (actually not looking forward to that bit  - she's harsh!!! Though I think that's what I need.)

It's been really worthwhile doing this – the amount of times I've wondered where that 20 pounds went that I only got out of the cash machine yesterday! Well, now I know. It's certainly made me think before spending now. And I've even started to bring lunch in to work – not quite every day but I'm getting there. Was quite a shock when you see a monthly total just for buying sandwiches.

So will I do it again? Yes I think I probably would. Not for a while, but it will be useful to do to see if I've learnt anything! And as for October, well, so far, I've lived within my salary give or take a pound or two!

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