Wednesday, July 30, 2014

Bracing ourselves for a new household budget


I'm bracing ourselves for the upcoming move but also how this will impact our new household budget. Officially, we will have 2 lodgers: DS # 1 and Gf, who were presented with a contract to sign that stipulates their financial and other contributions to the household, the clear expectations, etc. We all signed it, we each retained a copy. The new home is $500 more rent than I can comfortably afford, they are eash paying $250 in "lodger rent."  If I had to, yes, I could pay it (one or both left), however, it would greatly impact my ability to meet my upcoming financial goals.


I've had several, frank discussions with the members of the soon to  be blended household stressing that we need to be prudent, especially the first few months, until home costs start to level out. We will continue to live modestly. One of the clauses in the lodger contract, for instance, stipulates that laundry will be hung up to dry (clothes line/clothes racks in Sun room which I was told is warm even in Winter). Should they use the dryer for laundry (besides towels, which I would wash anyway), they are expected to pay $1/load for use of the dryer. I had previously calculated my savings rate at 90 cents/wash load if I hung the laundry to dry. Small measures, but they do add up.

I've taken a look at my household budget for this place, trying to earmark areas for potential increases/decreases once we move. I identified the following categories:

-rent increase
-lawn service decrease (a $5/week savings)
-monthly cleaning service ? (I get a quote on Fri)
-electric? (more people=more utility usage)
-cable/Internet decrease (since we're moving, I was able to take advantage of a moving promotion and our rates are decreasing for one year while the service package will go up a notch, back to the level we were at a year ago, before I dropped us down)
-oil-I fully anticipate a major deccrease even with 2 more people added to the family. Same size home (2600 sq feet) but well built, new energy efficient windows, a new energy efficient wood stove, zoned heat again, and I just learned: all new kitchen appliances! The new LL just posted on the town facebook webpage, all of the existing appliances, asking for an offer as she just remodeled. These are the exact appliances that were in the kitchen, so I am certain that they were just replaced. New stove/fridge/dishwasher/microwave over the stove. Awesome!
-gas costs will definately drop for the 3 young adults in the household-they will have a 5-8 minute commute to their jobs, and 2 ride share anyway (DS & GF have 1 car), I suspect my home-work commute may also be shorter, as we will be moving very close to the main thoroughfare that I take to get down county. I'll have to check in Aug when I return to work. I get fantastic MPG with my Prius so I am not overly concerned. Pleased for the "kids" however.
-I am on a promotional rate with the newspaper, having transfered our subscription to the new home, effective 8/1
-food: I am aiming to keep my spending level to the same as it is now: $100/person for the month. Using many economical tricks, I feel confident that we can continue to eat a healthy variety of foods on a budget, including some treats, organic farm CSA, etc. I've cautioned the 3 paying towards the food budget that this may also increase, due to ever rising food costs
-the remaining budget categories of the household budget should remain as is: celebrations, life insurance, personal care, pet care, medical OOP, school costs, postage, accountant.

Overall, if we remain careful, the increase in rent will be at least partially offset  by the decrease in  costs for oil, lawn service , cable/Internet, gas.

Am I missing anything? suggestions/thoughts welcomed!


missy said...

Sounds like you're on track. We recently had college daughter move back in with us while she finishes her education and beside food I did see a significant increase in water and electricity. Also toiletries seems to disappear much quicker. :)

Also does your food budget include everyone who works LUNCH? $100.00 a month for food per person seems a hard least for me. I find adult children eat more and waste much more.

I LOVE and ADMIRE your amazing ability to track and hold a budget so well organized. I have learned so much from you.

CTMOM said...

Thanks for your comments. I find that $100 is a pretty generous amount/person. THis includes food, health and beauty aids(soap, shampoo-basics), paper goods (tissues, Tp, cleaning supplies, laundry supplies. I am a very careful shopper. The house rule is: I buy the cheapest choice for most things (Vo5 shampoo for example, never paying more than $1/16 oz bottle). Don't like the brand (assumes at least someone else does or I won't buy it again) then supply your own, this would be considered and "extra." Ditto make up for DD-I won't buy that. We're on well water so no costs. Electric is used to pump it, but lodger contract specifies 10 minute showers. Yes, this includes lunch. Sandwich on homemade bread, usually home roasted meats vs cold cuts, but some lunch meat is purchased. We push homemamde soup, and leftovers for lunch at work/school. When DD moved back home in May 2013, our utilities continued to stay the same. We concerve as much as possible. : )

Justin Matters said...

Just an idea: instead of hiring a cleaning service, would it be possible to have son's girlfriend do some or all of the cleaning? Her portion of rent could be reduced accordingly. Perhaps she is too busy with work, but it was a thought. Sounds like you are working things out much better than most folks! Keep up the good work!

Leslie in SD

CTMOM said...

thanks for your comments. Per the lodger contract, DS # 1 and Gf are responsible to clean their room weekly (vacuum, dust, change linens, empty trash etc) except for the week when the monthly cleaning service comes. Sounds like a luxury, but with my OT issues, working F/T and commitments, it is necessary. I budget accordingly. DS and GF (as with all household members) are expected to maintain the cleanliness of the home to the cleaning service standards (pretty pristine). All are expected to clean up after him/herself as well as to help with general cleaning in off weeks (no cleaning service)during the month for common areas: bathrooms, den, living room, kitchen etc. They are also expected to help with outside chores, not limited to: walkway snow removal, trash/recycling/composting etc.