Nothing stresses a person out like trying to put together a budget. A friend of mine has her heart set on a cute little condo. I helped her to put together some preliminary numbers in a budget which came up to a shortfall. It is always interesting to go through each category and decide what is important and where there is space for adjustments. My challenge personally has always been in trying to work it too tightly. I feel like if I just give up a bit more, I can pay that debt off quicker. The problem is I don’t give myself that buffer and it ends up creating more problems. In looking over her numbers I could see that she was lacking in an emergency fund as well. One of my goals is to establish $1000 for an emergency fund. (Anyone who is a fan of Dave Ramsey will recognize that as an important first step.) Key Bank has been running a special that if you do two electronic deposits of at least $100 each they will give you a free ipod nano. My problem up to now with using my savings account is that it is linked with my checking account, which makes it too easy to dip into.
While running her numbers, I kept working on fitting the Expenses into the Income. There is a significant difference if she purchases this condo. I think she does have the ability to do it, but she will have to make some lifestyle changes. She is already restricting her meals out and she had decided to give up her Dish and high speed internet access. My question is when do we get to the place where we have to stop trimming. I mean, lets be realistic. You can’t budget out food or shelter, but just how low can you go. This is where the frugal game gets played.