July 2015 Budget & Shopping Ban Update

You’re going to think I’m a dork for saying this, but it was really fun to piece together a new format for these monthly budget posts. Years ago, I used to share my budgeting “plan” at the beginning of the month, then show you how the final numbers came out at the end. Last year, when I decided to try and live on 50% of my income, my income also began to fluctuate greatly from month-to-month because of all (or none) of the freelance I did, so I stopped sharing my plan and just showed you what the final percentages were. And for the past few months, I’ve stopped budgeting altogether, because I know I will always spend somewhere between $2,100-$2,300/month, and then save/travel with the rest.

So, how do you budget/format these posts, when you work for yourself and your income will always fluctuate!? Well, here’s my first attempt, along with the list of items I bought in July.

First, I want to say that I know why budgeting is so difficult for people whose income varies from month-to-month. When you don’t know how much money is coming in (or when), spending it on anything can feel stressful. The trick to overcome that anxiety is to already know yourself + your spending habits so well that you know how much money you need to live a good life each month. After years of tracking my spending and budgeting, I know I typically spend $2,100/month on my living expenses, and up to $2,300/month if I have any birthdays, celebrations or extra medical expenses. So, I don’t budget… but I track my spending weekly, to see how I’m doing.

The other trick to overcome the financial anxiety that comes with working for yourself isn’t really a trick… it’s a buffer. When I quit my job, I wanted to have $10,000 in my chequing account, so I would never have to worry about making/paying off my regular expenses (I put everything on credit to earn rewards). Instead, I only had ~$8,500, which is still 4x my regular expenses; that buffer stops me from having to check the balances of my accounts every day and helps me sleep better at night. I’ll eventually get it up to $10,000, just so I reach the original goal I set for myself, but knowing myself + having the $8,500 buffer is what helped me feel confident enough to take the leap into freelance.

July Budget

Before I quit, I ran the numbers and knew I would need to earn at least $6,100/month if I wanted to bring in the same amount of money I was earning before (because I now need to set aside 35% for income taxes). If I earn $6,100/month, I’ll have to set aside $2,135 for taxes, which would give me just under $4,000 to play with. After spending up to $2,300 on living expenses, that would give me about $1,700 to travel/save with. I had the potential to earn that amount + more, in July, but I actively chose not to. I started and finished the month off strong, but took a lot of time off mid-month for my two trips, my move and a friend’s emergency… and I don’t regret it.

There were moments when I felt guilty about not working more hours, or not making more money, but I kept reminding myself that being in control of how much I work is why I wanted to work for myself, in the first place. In total, I invoiced for $4,773 – $1,670 of which had to be set aside for taxes; that means I had $900 less to work with than I usually do. Here’s what I did with the money.

Life Expenses – 52%

For new readers, “life” expenses includes all my regular living expenses, like housing costs, food, car insurance and gas, etc. as well as all my insurance policies, medical expenses (trips to massage or physiotherapy), gifts for others and charitable donations. My numbers were all fairly standard, this month, except that I donated more money than usual (including to my friend Anthony who is donating his birthday to The Hope Effect). The other big expense I had to pay for, of course, was my move… but I’ll get ~$475 back next month, when my security deposit is returned. All-in-all, I spent 52% of my income on life. When I start earning $6,100+/month, that number should be in the 34-38% range.

Travel – 13%

Earlier this month, I drove down to Portland with Sarah to go to WDS 2015, and then I went to a bachelorette party on Salt Spring Island. Altogether, the costs for both trips was manageable, and I had a great time (especially on Salt Spring!) but I’m really happy to say that was the last of the travelling I’ll be doing this summer. It’s not that I don’t love travelling… I do, for so many reasons! But I’m just ready to finally put some roots down and explore more of Vancouver Island. In the past week, I’ve already done two new hikes and want to do more this summer. I do have plans to travel to two conferences this fall, but those trips will likely be the only time I get off this island in 2015… and I am a-ok with that!

Taxes – 35%

Most people I talk to tell me to save 30% of my income for tax time, but I’m scared it won’t be enough, so I’ve decided to save 35%. I’m going to owe a large sum of money to the Canadian government, next spring, and I’d rather have more money than not enough to cover it! I consider this one of the most important categories in my budget, and I almost think about it like a debt. Similar to the way I used to tell myself I’d pay off my credit card debt “one day”, it would be really easy to say I’ll save for taxes “one day”. But if I don’t save the full 35% each month, and instead try to save 37%, 40% or 45% next month to catch up, I could quickly end up in a situation where I owe more than I can afford to pay.

If you ever see this say anything below 35%, feel free to call me out.

Savings – 0%

So, guess what happens when I “take home” $3,100 (65% of my income this month) and spend $600 on travel? I don’t save a penny. I’m not happy about this, and I don’t plan on repeating it… but it’s August 3rd, so I can’t turn back time and change anything now! Instead, all I can do is take it as a lesson learned: if I want to save money, I need to work more and earn more money.

If I earn $6,100/month, I’ll be able to live off 36%, set aside 35% for taxes and save 29% – if I don’t travel at all. So, the second lesson learned is that, if I want to save 30% and still travel, I need to earn even more money. Nobody said self-employment was going to be easy! But I still think it’ll be worth it… now, if you’ll excuse me, it’s time to hustle. :)

Shopping Ban Update

Now that we’ve looked at the numbers, it’s time to give you a shopping ban update. Four weeks ago, I made the crazy decision to extend my yearlong shopping ban to a two-year ban. At first, I thought it wouldn’t be that hard, but I have to be honest and tell you I’ve been tempted to shop at least half a dozen times this month – mostly for new clothes, because nothing is fitting right these days.

The other reason I’ve decided to do a ban for a second year is so I can track every single thing I do buy, and show you all what an average (female) consumer purchases in a year. I only purchased 4 things in July, 2 of which were definitely female-specific. I also hate taking cold/sinus-type meds, when I’m sick, but there were a few days where I don’t think I would’ve gotten out of bed if I hadn’t…

Items I purchased in July 2015:

  1. 1 box of tampons*
  2. 1 travel size bottle of Advil (while in Portland)
  3. 1 box of Tylenol Sinus meds (got sick after moving)
  4. 1 pair of TOMS** (to replace the ones I tossed in June – taken off the approved shopping list)

*Many of you have suggested I try switching to a DivaCup, to save money and cut down on my environmental impact, so I’m going to pick one up in August, rather than buy more tampons.

**I was trying to hold out for a pair of Sanuks, but I searched high and low and eventually got to a point where I needed shoes… so, TOMS it is. We’ll see how they hold up…

Overall, I guess it was a successful first month of working for myself, considering that I actively chose not to work much mid-month… but I’m going to make sure my numbers are very different in August. I’m not travelling at all, but I did just book my flight to Charlotte for FinCon last night, so a little bit of my budget will be allocated to travel expenses. Now, I just need to earn more, so I can start saving for retirement again…

How did your month finish up!?

  • Hi Cait,
    You’ve had a busy month! I’ve just discovered your blog and I can’t tell you how helpful it is.
    I was just wondering how long you think about your approved shopping list for the year? I’ve just started a month shopping ban and it’s going well so far! I’m thinking I should continue it on, but the list is something I keep changing and am generally indecisive over. How long did you ponder over your approved items?
    Have a fab day!

    • Hmm, I’m actually worried I didn’t think about this one enough… I mean, I knew what my immediate needs/wants were, so I went with that. But something *could* come up in the year that I didn’t plan for, and I’ll just have to think about how I handle it then. I wouldn’t put too much energy into it. Honestly, the more you *think* you might need things, the longer the list could grow. Just start your ban and see what happens! :)

  • Good for you! My husband is self-employed and it definitely takes some getting used to. It took us a while to realize he needed a separate savings for business expenses; broken laptop = no income, no external hard drive just invites disaster, etc.

    My shopping ban is going reasonably well (it is admittedly less strict than yours). I’m reaching my near-walkie talkie with an actual iPhone… but I think my employer will cover it, so YAY. I had to get some new pants (weight loss), and Goodwill had my back. I’ve bought no makeup, jewelry, shoes, kitchen toys, books, etc. for 3 weeks. Two of my prescriptions have more than doubled in price – they’re now over $100 each! – but from living a more frugal lifestyle it’s more manageable. Still sucks to pay that much, though.

    • Ahhh yes… I’m a little unsure of how to handle business expenses, as well, but so far I don’t really have more than $30/month (so it’s just in “life”). I do keep track of it in FreshBooks though, where all my business income + expenses live!

      • Hi Cait,

        I’m a freelancer in Vancouver. Have been for over twenty years. $30/month for business expenses seems really low. You can deduct a portion of your rent (plus that same per cent for heating and util costs), your cell phone, books, magazines, banking fees, office supplies, drycleaning, wine for clients…and of course, that 35% is off your income less deductions… so a bit less. Your RRSP is also a huge boon for a freelancer (assuming you are sole prop?).

        Good luck!

  • I wondered – since you’re spending your after tax income, do you think your percentages should be based on the 65% of after tax income?

    When I track spending, and I expect the same for you when you had regular income, it was always with the amount I can spend, after deductions. That gives you a better impression of what 50% of your income is if you want to live off it, and more challenging to meet that goal.

    Of course you can do as you like, but I just thought I’d make that suggestion.

    Thanks for sharing!

    • I did think about that! But I want to stay accountable to myself re: the 35% taxes, at least for now… plus, this is the first time where I’ve really felt like I worked hard for every single penny I earn, and it just feels different now that I have to immediately set aside such a huge portion of it. I know that’s not a great answer, and there shouldn’t be emotion in money… but if I work my butt off for $6K+, it’ll just feel good to say I live on 34-38% of that. :)

  • Congrats aim a successful month. Hope you enjoy the Diva cup. As someone who is self-employed too, I often have the ‘I could have made more’. Some months I do but then the quality of my life suffers. There is a cost to having more $. I have learned what we need and work for that and still have time to relax and enjoy life. I now pay the government monthly to avoid a big surprise in April. It is what works for us best.

    • Yea, I believe I’ll have the option to pay quarterly next year, which will feel nice! Having thousands of dollars sitting around in cash just feels weird… I wish it was going somewhere now!

      • Cait,
        You can set up an automatic deduction at CRA anytime to match your own preference for time and amount. In this same vein I like to commit as much as possible of my anticipated monthly income to designated accounts so that all I am left with is a tight budget for life expenses. Since I am in savings mode, I have a second bank (with a higher savings rate), withdraw an amount that would qualify me for being in the shopping ban group! This method takes away temptations.

  • I’ve had a Diva Cup for 9 years now and I don’t regret it at all. It’s clearly a learning curve to properly know how to use it but when you master how to insert it and take it off, it’s a miracle !

  • My husband and I are on a spending ban. We really haven’t talked what that all in entails, but right now trying not to go out for dinner so much.

  • So excited that you are getting a Diva Cup. I love mine!! I switched over from tampons about a year ago and haven’t looked back since.

    This month I was able to put 53% of my income towards my debt (which is actually way better than I thought before calculating it just now!). Because I’ve been using your Mindful Budgeting program the past few months, I know that I also spent $57.00 at Bulk Barn (likely on junk food) and another $137.00 on other “vices.” So there’s definitely a lot of room for improvement this month. I’m doing my own version of a shopping ban this month, so I’ll be interested to see if my numbers are any different at the end of August.

    • Lisa, that is FREAKING AMAZING! And yes, I’ll be very curious to see how the numbers look at the end of August. Keep me posted, girl. So proud of you for sticking to your goal to become debt-free! :)

  • Sounds like you had a good first month, I’m years away from being able to quit but am very encouraged by reading your posts. You have no idea how encouraging this blog has been to me.

  • Cait,

    It sounds like you had a very successful first month, which is so great to hear! With your attitude (“time to hustle!”) I think you’ll be making that $6,100+ a month in no time! July has been an absolute whirlwind. We had a garage sale last weekend that allowed us to bring in about $800+ in additional income, and still donate over half our items as well! This amount is going straight to padding our future down-payment for a home. We finally move this coming Sunday, thank goodness! Moving expenses & doubling up on deposits/rent have been a real doozy. We’re also heading to San Diego in two weeks for one of my best friends’ wedding (pre-planned & allocated for trip), but the hotel expense comes later. We’re very excited to get back to a month that has more normalcy lol! P.S.: I need to look into this DivaCup, I don’t think I’ve ever heard of this before!!

    • Wow, sounds like a crazy month for you guys, for sure! But huge congrats on the $800+ in sales – that’s awesome! And I know how hectic both moving and travelling are, so remember to take care of yourselves during that time. It’ll all even out and get back to normal soon. (And yes, look it up! I was weirded out by it, at first, but everyone raves about it.)

      • Re: the Diva Cup… I was totally weirded out by the idea of it, too. It took me about a year from first hearing about it to order one. The first 2 months I tried it, I thought it was better than tampons, but I wasn’t a total convert (i.e someone who would take time to write a comment regarding her ladybits online). However, this last cycle? Holy cow, it was a game changer. A thousand times easier to deal with than before and it felt very simple, and did not inspire the “Oh good GOD why does this have to happen EVERY. SINGLE. MONTH.” rants I would have previously had.

        I guess my point is: try it out for a few cycles. Be patient with it. At worst, you’ve spent just a tad more than what those equivalent months would have cost you in pads/tampons. At best, you’re done with expenses in that arena for a number of years!

  • The numbers look great considering this is your first month working for yourself, great job!! I guess it will get easier to budget once you start sending out invoices and you know when that money will come in. Looking forward to seeing how things progress.

    A note on the shopping ban, since you have a one in one out rule, if some clothes just don’t fit right could you not donate them and replace it? I’m not trying to find a loophole for you lol, but I feeling good in your clothes is important :) Oh did your plants survive the move? I have some peppers growing and cherry tomatoes, it made me wonder how yours were doing!

    • Ha! That’s not really a loophole, that’s pretty valid… but the problem is that some of my summer clothes from previous years don’t fit because I’ve gained 5-7 lbs. and I’d like to lose that. So I don’t want to trade for bigger clothes, I want to lose weight and fit the clothes I already own! That’s a big goal for August/September. :)
      And my plants did just fine! Actually, the spaghetti squash doesn’t look super happy… but it’s still growing, so I’m trying to nurse it. :)

      • Gotcha! That is completely valid and I’m sure that won’t be a problem with all the hiking you’ve been doing. I find my body gets a bit angry when my routine changes so maybe that is the same for you. Good luck!

        I have been giving my plants my coffee grinds every am, picking a different plant every morning, and it seems to help them out.

  • I’m always impressed by how you can break your budget categories down into percentages and usually nail them. I go with numbers based upon what’s available – I’m scared to break it down into percentages and see what they look like (housing vs living expenses vs entertainment vs savings, etc). Although it would likely help me get an even tighter grip on our finances…

    • You’ll appreciate this, but percentages make it feel like more of a challenge. I HATE seeing my living expenses go over 55%, so I work hard all month to keep it below that. Sort of like some other challenges I know you like to take on… at the gym, perhaps!? ;)
      In regards to being scared about the percentages, I’d throw what the experts say you should aspire to out the door and just do what works for you guys. Look at the averages from the past few months and write down a goal you want to work towards – not what anyone says you should do. :)

  • Make sure you remember installments for taxes now that you’re self employed; you don’t want to have to pay interest on your taxes owing!

    You have to submit installments if your taxes owing will be $3,000+ in 2015, and was $3,000+ in either 2014 or 2013. If not, no worries until 2016. (I’m an accountant ☺️)

    • Hmm, interesting… is this something I have to do in 2015, or can it begin in 2016 (after I file this year’s taxes)? I don’t have GST setup yet, because I’m nowhere near hitting $30K in self-employment income for the year yet. Is GST part of that equation? (I have an accountant and she told me to just keep on, keepin’ on, and that we should talk again when I get closer to the $30K mark.)

      • Because of the service I provide, I am GST exempt. We just starting doing monthly instalments of taxes because I started making a little bit more. The government suggested it, but did not require it. Our accountant said one option was to set up a separate personal account and save the money to pay it annually (and you may get the little bit of interest on it). However, we decided that we would just pay it and if we owe some money in the spring, it will be reasonable, and if we overpaid, darn, we will get a little money back!

        • Thanks for explaining what you do, Kristen. I think I’ll just continue to save my 35%, and reassess when I need to get GST. There will be many blog posts to come, I’m sure, and I’ll happily accept all input and expertise! :)

  • Have you thought about transition to living on last month’s income (You Need A Budget-style)? This seems to work well for people with variable income.

    • Umm… not really, because I guess I already do that, to some degree? I used a little bit of my buffer, when I needed it, but then finished the month with the full $8,500 again.

      • The only thing that would change for you is that you’d have a concrete number to start from when planning expenses for the following month.

  • Your post is very motivating. I haven’t started a shopping ban yet but I’m close. I did, however, redo my sewing room with shelving that was already there but got moved around. In the process, I found more fabrics and supplies I don’t need and put them in the garage for my next garage sale. Or I’ll give them away from my blog and to young students who don’t have a lot of money.

    I was very surprised by the 35% for income taxes in Canada. Is that usual? Also, I wondered what your freelancing job is about. If you wrote about it sometime earlier in your blog, I missed it because I’m a fairly new follower.

    Keep up the great work. It is all wonderfully inspiring.

    • No specific job, per se – I have about 6 different income streams right now. I do a lot of freelance writing and editing, I manage another blog, make a little bit of money here and work on online courses. And yes, like Isabelle said, 35% is normal. (It’ll probably only be 29%, but I’d rather have the buffer, like I said!)

  • Keep up the good work!
    For my part, the shopping-ban is going extremely well. I’ve been tempted a few times by shoes and clothes on clearance, but I resisted. So, in the past 15 days I did not buy anything on my extensive ban-list, yay!!

  • Way to go Cait! As for the clothes not fitting right if it’s because you’re losing would you consider having them taken in as opposed to buying new ones? If it’s your professional clothes I’d definitely consider it.

    I’m on a no spend month for August because of my root canal not being nearly covered as much as I thought it would be. Out of $1900 only $281 was covered because I’d maxed out on coverage this year. Not that I could put it off as it was desperately needed but it still hurts to have it on my credit card. And no savings either. I know I’ll get through it though. But no buying anything!

    • Oh nooo! Ugh, I’m sorry you had to pay for so much of that… what a bummer, Nadia. Good thing summer = warm weather = spend more time outside than shopping!? Trying to find the bright side for you…

  • Good Job, Kait.
    I would love to be bringing in over $6K a month. I ought to be running more in your circles. I’m trying, though and I guess that accounts for something. I haven’t had too much luck with Carrie’s Client Connection Service. I guess, it’s because, I’m not in the financial writing niche. I’d love to get there, though.
    So, I guess my August goal is to get a freelancing job in the financial writing niche. Well, to be honest, if I could get JUST 1 freelancing job in any niche, I would be very pleased.

    Just a little reminder that now as a freelancer, you have a lot more expenses that can be written off to reduce your tax bill. Your phone. … your computer. … your internet. … your conference expenses. … a portion of your rent. … A portion of your hydro, gas, etcetera. … Your insurance bill. … Your gasoline costs, if you travel to see clients. … I think you get the picture. I’d like to see you only pay a 15% tax bill. But, I think you’re wise to save the full 35% for taxes, just in case. It’s a good thing you are used to tracking your expenses. That skill and habit is more necessary now, as a freelancer where you have to account for every penny.

    I’m wishing you good freelancing in August. No doubt, you will reach your monthly income goals.

    • Yes, it’d be nice to see my tax bill get down… but the buffer will just help me sleep at night, haha. And, really, I could then use any extra money to either start saving for taxes in 2016 or pay for any business expenses I may have! I wish YOU luck with freelancing, Jen. Please remember that much of the freelance I do is for companies I used to work with, where I’ve just switched from employee to contractor – so no one should compare themselves to my situation, as we’re all in unique positions.

  • I love your updates. And the new format really highlights the “mindful” behind your spending. You may not have saved anything this month, but you had an important month and the spending was all very thought-out and aligned with your priorities, so I consider it a total success. Well done! And I love the specific list. Keep it coming. :)

    • Thanks, Maggie! Yes, the list is here to stay… I can’t wait to put it in a spreadsheet at the end, to show how many things I bought in the year!

  • Way to go, Cait! It sounds like you made a pretty decent income considering you didn’t worth for a chunk of it. I’d be curious to know the breakdown of your income in future posts. I.e. what proportion comes from writing, community management, etc. Looking forward to seeing how August progresses – I’m sure it will be a super successful month.

  • Congrats, Cait! What a great first month. It’ll only get bigger from here :)

    One thing that made me chuckle in this post – “The other reason I’ve decided to do a ban for a second year is so I can track every single thing I do buy, and show you all what an average (female) consumer purchases in a year.” I don’t think you’re an average consumer anymore, and that’s worth celebrating!

    My shopping ban is going well, although it may be because my husband is out of the country for a few weeks. I’ve been a bit of a hermit and as a result, have only bought gas and groceries recently. It’s been really nice to see so few transactions when I look at my bank account!

    • Ha, well that’s probably true… I guess I should’ve reworded it to say that I want to show us what we ACTUALLY need to consume in a year. Really, I could’ve cut that Tylenol stuff, if I’d just sucked it up and tried more home remedies… but that + my neti pot saved my butt and helped me get some work done!
      And it doesn’t surprise me that you’re spending less while home alone… I often wonder how my budget will change if/when I start dating someone seriously! Enjoy it while it lasts. ;)

  • Well I definitely learned something new today! Thanks for the info . Your shopping ban is very impressive and I’m sure that it’s very hard at times. Outside of normal living expenses I only bought a picture in July which was a massive improvement over June!

  • First off, I just started reading your blog, Cait, and the inspiration it provides couldn’t have come at a better time. I motivated myself to pay off about $35,000 in debt in 3 years (mainly student loans and some credit card/tuition), but ever since then I have had so much trouble saving at that same rate. My husband and I have been trying to save for a downpayment on a home, but after almost 2 years of saving, we are still 2 years away from our goal, and I would really like to get there sooner. Our July expenditures were so high that we saved nothing, and actually had to take money out of savings. I am feeling so frustrated that we’re not getting closer to getting into a home. I’m going through your old posts to see how I can apply your shopping ban to my lifestyle, and hopefully, get on the right track towards saving!

    • Well, I’m glad you found me when you did, Lauren! I was in your place this time last year, when I realized I was getting nowhere with my savings goals. I’d buy things, go out, travel, etc. but then only save 8-12% of my income, even though I wanted to be saving 20%+! I hope you find some inspiration in posts (look at July 2014 onward) and am always here to chat if you need more motivation. :)

  • You’re going to love the Diva Cup! I’ve been using it for over a year now and it’s not only saved me money, but it makes my period SO much easier to deal with. Win win!

    The cost of stuff like Tylenol is always the worst, eh? I usually count it as part of my grocery budget and just try to grab generic brands or stuff when it’s on sale.

    I love reading your updates!

    • Cool! I put them under “personal care”, which is where I put all toiletries, prescriptions, clothes, etc. But I love that everyone budgets things differently. One of the best things about personal finance is when you see that you can do whatever makes the most sense for you!

  • Having a “buffer” is SO important in a budget. I learned that from work, where I manage construction projects which always have “contingency.” Now I apply it to all of my budgets.

    July wasn’t a great month for my budget, but my spending was as anticipated so I’m not too upset. Fuel for August motivation!

  • Loved your post, Cait! I’m inspired to consider my own percentage breakdowns (and I just might dare to adopt the no budget approach to saving/spending). My shopping ban is going strong – this week I actually removed a couple items from my approved list after realizing I don’t really need/want them as I had originally thought. I also decided to eat out less than I had originally planned – instead of going out to eat once/week, I only want to go out to eat when it’s social (still maintain the once/week maximum) or a special occasion, or travel. Thank you again for all of the inspiration!

    • I don’t typically recommend NOT budgeting… but if you trust yourself to spend within your limits, and pay yourself first, I don’t see why you can’t adopt it! :)
      Sounds like you had a great week, Megan! How long are you doing your shopping ban for?

  • In my high income years, I did what you’re doing: 1/3 taxes, 1/3 living expenses, 1/3 savings/investments. Allowed me to “pre”-retire at 45. Of course, the stock market was doing much of the magic then; now, not so much!

    That thing is awesome and a life saver! Though, I use light panty liners for leaks but luckily my mom keeps giving them to me every time I go home so I’m basically spending nothing on menstrual products! Win!

    I understand the itch of buying new clothes… I’m 8 months in my clothes buying freeze and once you get over that itch then it’ll get easier from there. I’ve been getting away with “new” clothes by attending clothes swaps with friends ;)

    • I’m 13 months in and still get the itch sometimes, haha. But it’s all good, I’ll just carry on. Thanks, Rebeca!

  • I recently stumbled across your blog and decided today that I’m going to start a shopping ban. I’m thinking just one month for now, then likely extending to three months and assessing from there. I basically did a shopping ban in April, but it would be nice to make it a more consistent habit. And I’d like to cultivate overall better control over spending/saving. This month (because I am temporarily in a situation where I don’t have to pay rent), I’m shooting to live off of one paycheck ($1200) and save the other (and my pie in the sky goal is to live off <$1000 for August). I don't have any debt, but my savings won't even cover a full month's expenses right now and I'd definitely like to change that. I'm really interested to follow along and see how your budgeting goes as you settle into full-time freelance! That's my ultimate goal also, though I would 1) like to have a realistic buffer first and 2) need to start building up something on the side while I still have my current job.

    • Those all sound like great goals, Iris! What are some of the things you’re NOT allowed to buy during your shopping ban?

  • Moving are always a lot stressful and expensive but is normal that you didn’t save at least it happens to me when I change work because I need a couple of months to understand and adjust budget, but considering everything you achieved in the past year I’m sure you’ll do a great work also in this second year of shopping ban and this new self employed life. I’ve just started my 3months of sort of shopping ban considering some interesting news onwork side from september, but is never too soon to start to think about savings right?

    • No, you should start thinking about saving as soon as you make money! I certainly wish I had. Good luck, Giulia!

  • Congratulations on a successful first month, Cait! Self-employed taxes are rough, huh? I recently quit my part-time job and started freelancing more. And I’ve been shocked at how much I have to set aside. I have so many friends who totally ignore taxes until April and then have to cough up a painful amount of money. I like your strategy and thinking!

    • Oh my gosh, that would be my worst nightmare: to get a massive bill in April and not be able to pay it! I know the big bill is coming, so I just need to prepare for it; that’s how we should think of all expenses, right? :)

  • I cannot recommend products like the Diva Cup any higher!! It has made the process of menstruating so much less stressful and embarrassing!

  • Hi Cait – I’ve been finding your blog very motivating, and in the past month I’ve put myself on a “shopping diet” (not a full ban) for the highly discretionary expenditure categories that I know from past tracking are the ones that can easily eat up a chunk of savings. (For me, that’s apparel (including shoes and bags), books/media, and photography-related gear.) I’ve also been very inspired by how you pared down the stuff in your life, and I’ve made major progress in my office (so much so that I’ve had to reassure my boss and a couple of colleagues that I’m not planning to quit :) ).

    I have a couple of suggestions for you to consider as you transition to a freelance income (and deal with taxes etc). At one point in my life, I was a partner in a law firm and I had to develop a savings strategy to ensure I wasn’t caught short at tax time (quarterly). I watched a few new partners in my firm make the mistake of investing a large part of their tax savings in the market and then get burned when the marked dipped. There was no way I as going to do that, but since the “tax savings account” was not an insignificant sum of money, I also wanted to earn a little investment income – so I chose to keep most of it in a money market fund in an investment account. Aside from earning a bit of investment income from that account, that set-up also kept the funds separate from my everyday funds, and I knew that in order to spend from that account, I had to take a couple of extra steps and wait for settlement of funds. It really stopped me from thinking of those tax savings as “my money” – it was the government’s money, and it was easier to ignore.

    The other suggestion I have for you is more of a business productivity suggestion, and that is for you to consider tracking some kind of “ROI” (Return on Investment) record, where you track the $ and effort that you invest to produce your freelance income. I have some friends who switched to freelance after leaving companies, and in circumstances similar to yours where a fair bit of their freelance income initially came from the companies with whom they used to work. When you’re in that situation, it can be easy to forget that you need to invest in maintaining/enhancing those existing relationships and in building new relationships (as well as investing in the tools and knowledge needed to compete in your field). This kind of “account” might also give you some comfort when you decide for very good reasons to take some time off, as you did in July. You’ll also start to see patterns over time, and that might help you figure out when you need to step things up on the promotional/marketing front, or when you can cut back. It might be particularly important for someone like you who is operating on a very strict budget (with a shopping ban) and whose professional “persona” (part of the reason people might pay you to write) is linked to that frugal/minimalist ethic. For you, it might be hard sometimes to spend $ for very sound business reasons (e.g., good quality business cards, or a coffee date with someone who might be in a position to steer work in your direction in the future), so keeping track of investments in your business (whether of time or money) might help you. Anyway – best of luck in the coming months. I look forward to reading more.

    • I think this is one of the most useful responses I have seen. As a long term self employed person it is very easy not to , as is suggested above spend on good quality business cards etc. and also to spend on some
      hospitality- coffees etc.
      Casual encounters and developing relationships cost. People are of course always moving on. What was once a given can evaporate due to finance ,being human, government.. Also being self employed can result in an ‘At Home’ mentality which results in a lack of social contact. Online connection is just not the same when you have to’ gell ‘with the context of a project.
      Thank you for the blog and its connections.

    • JH – I wish you lived here, so I could take you out for coffee and chat more about this! I recently decided that business expenses are “ok” to spend money on during this ban, and am finally going to pick up an 18-month planner later today, so my life isn’t stuck on post-it notes! Thanks for giving me the extra push. I shouldn’t have needed it, because this IS a a “thing” that will get great use, but I’m really happy I’m finally going to pick one up and get more organized.
      As for making new connections, that’s something I’ve thought about a lot, since making the move back to Victoria! In deciding to move, I knew I both wanted and needed to make connections with other freelancers, small business owners and entrepreneurs here – and so far, I’ve been doing just that! I really appreciate this suggestion, along with all your others. Thank you so much for taking the time to leave such a thoughtful comment! :)

      • Thank you, Cait, for the kind words. It’s too bad (for me) that you’re not in Vancouver anymore because I’ll be visiting my family there later this month. But maybe things will line up another time (or we can catch up if you ever visit NYC).

        I did forget one key element of my suggestion regarding an ROI tracker: not only should you track your expenditures (of $ and time) but you need to line those up with results, so that you can see your return on investment. For example, did this coffee meeting lead to an introduction to someone who could send work your way? Did your investment (of time and $) to join a networking group or to attend a conference in another city translate into paid assignments, creative ideas that led to money earned, etc? Of course, you need to be creative about what you track (because some of the valuable results will not immediately translate into $ in your bank account, but the results are still worth tracking).

  • Hi Cait! I just discovered your blog a couple weeks ago, and I have to admit I am slightly addicted to reading your posts!! With an accountant for a Dad I learned very early on the value and power that money can have, so creating and sticking to a budget was never hard for me, until I finished University and had $23,000 in school debt to pay off. Like you I managed to pay my debt off over the course of a couple years, and moved back in with my parents, so that I could get in done in the time frame that I had planned for. The one thing I always had problems with those was acquiring a lot of “stuff” over the years. I quite literally have books that I bought when I was a teenager…I’m now 31 and have never read them!! Same goes for movies, jigsaw puzzles, etc. I am now beginning to realize that as much as I enjoy having those items in my possession, if I continue to hang on to them those books may never be read, those movies never watched, and those puzzles never put together. Reading your posts about minimalism and being happy with what you have has been a real inspiration to me to go through my own purge. I figured I would start small, make a manageable list of the books I can read, movies I can watch, etc and do it a month at a time. Do you still find things there are things you are able to live without owning, or do you still find an item here and there that makes its way to the donation pile?
    Keep up the great work!

    • Ooo it sounds like you’re at the beginning of what could be a huge and life-changing declutter, Jennifer! When I thought about those puzzles you haven’t, it made me wonder: how do you feel when you look at them? Do you get excited about doing them or do you feel bad because you still haven’t touched them? If it’s anything close to the latter, I’d say it’s time to sell/donate them… and that goes with everything you own that you haven’t used. Of course, start small! I occasionally find the odd thing that I can get rid of, so I’ll grab a plastic bag and donate it when it’s full. But I don’t think I could’ve gotten as far as I did if I hadn’t done one BIG declutter at the start. Good luck!

      • I sometimes feel bad that I haven’t touched them, but for the most part look forward to having an afternoon (or an entire weekend) to start doing the puzzles, watch the movies/TV series or read a book. My boyfriend is a big help too, as I’ve explained to him the desire to “use and purge” a lot of my stuff, so we do the puzzles together, read at the same time, watch the movies together, etc., etc. Our local library allows for one to “leave a puzzle take a puzzle”, and we’ve already traded one of my puzzles for a “new” one that can easily be traded back. Most of my donations though I give to my church’s annual yard sale, so even though I’m “purging” a little at a time, I still hold on to everything until May….

    • Yea, I’m still happy with it. I don’t feel good about not saving money, but my buffer remains untouched, so hopefully things only go up from here. :)

  • Hi Cait, just discovered your blog a couple of days ago. I can’t stop reading it. We are currently on a journey to become debt free, if my numbers are correct I’ll have my car paid off by the end of October. I’ve just done a whole revamp of my budget after reading one of your posts. We want to be debt free and then start saving for a tiny house!
    At the start of the year I made a goal to not buy brand new clothes for a year (I can still op shop or make my own), this was to look at how I’m spending my money as well as question the current fast fashion mind set. I’m 8 months in and have actually been minimising my possessions. At the start of next year I’ll try your shopping ban. Also I highly recommend the Lunette menstrual cup, I’ve been using mine for over 8 months now. It takes some getting used to but so convenient. Thank you so much for all the information, you are an inspiration. :) also congrats on being self employed!

    • Hi, Claire! (Some of my favourite people share your name.) So glad you found me! If you’re saving for a tiny house, I have to admit, I wish you’d write a blog about it, hehe. I am fascinated by the tiny house movement and would love to read someone’s journey from the time they decide to start saving to the day they move in! Anyway, that’s my mini side convo. ;) Sounds like the clothes shopping ban has been going well – can’t wait to hear about the full ban next year!

  • Here we are on August 5 and I’ve spent $165 unplanned dollars. My father is in poor health and I bought something to make him more comfortable and improve his breathing (my parents couldn’t afford it). I’m at peace with it and frankly, I was glad to be able to do it.

    For accountability sake I consider myself to have broken the shopping ban and now am starting over. Out of curiosity, how do you account for these types of expenses during a ban?

    • I don’t think you’ve broken your ban at all, Stephanie – that sounds like a necessary health expense for your family! You didn’t buy something just for the sake of consuming, following a trend, owning more, etc. So you haven’t broken anything… I’d say you helped someone find comfort in a time of need. <3

  • I was just reading your old posts. It is absolutely amazing that you have so much wisdom at such a young age.

    How do you get these assignments? I hope you will continue to get them past a year or too. Make sure you bill your clients a good sum of money to sustain you and not just for the work they see in front of them. 90% of your work will be under water, only 10% will the tip of the iceberg. Make sure they compensate you for all.

    Also, one of your older posts said you make organic homemade shampoo, conditioner, cleaning products and laundry detergent? Will you share it with us, please?

    I am heading into retirement and envy you that you can grow your own food in Victoria. Enjoy

  • I lost my job, got my job back and am now planning a move to Vernon. My life has been in flux. I have also spent a lot of time with some amazing friends and completed three Open Water Swim Races (2km, 2.1km and 1.5km).
    In July I also paid off my Government Student Loan, thanks to 3 pay periods and the boyfriend working a lot of overtime. I also went through and organized and shredded piles of paper I have been saving/storing for apparently no reason. I also started a spending analysis from Jan 2015 to now. My weakness is dining out. That is going to be a hard habit to break. It will help that I have made a decision to live a more sober life. Alcohol easily adds 20-30 dollars to your bill (drinks for 2). Granted I don’t spend my money on stuff, except gifts for others.

    I don’t think I could use the Diva Cup. It is an interesting idea. My flows are usually super light and tampons are usually not necessary or possible. I could not live without pain pills. I suffer from migraines and not taking anything is not an option.
    We are also seriously looking into buying a house in Vernon. The mortgage and associated costs would be cheaper or the same as renting and we would be living in a nicer house. We will see how this goes.

  • I just quit my job to work for myself and I’m kind of freaking out about it for many of the reasons you mention. I’m worry about having enough to live on after saving for taxes and I want to continue to pay down my debt quickly. It’s scary, but I’m hoping it’ll be worth it.

  • I was about to suggest the Diva Cup to replace your tampons, until I saw that you were considering buying one! I must say that the Diva Cup was a purchase that changed the way I see periods (not to mention the comfort and savings!).

  • Hi Cait – just stumbled on your blog – and perfect timing! 2015 has been my ‘Year of Clarity’. I’m in the process of becoming debt free (2 months and 9 days to go!!) and was so glad to read your realization about how saving to pay off the debt was easy because it was important but saving for savings sake didn’t have the same priority. I’m pretty sure I would have been headed in that very direction too if I had not read your post. I really appreciate you acknowledging that and putting it into words so perfectly suited for my ears. Sometimes the message is obvious but not clear until I ‘hear’ it a certain way. 😊 I’ve been living off of 18% of my salary and have been fantasizing about all kinds of ways to spend money…even though there really is nothing that I need. Thanks again!

  • How about incorporating and paying yourself out in dividends? Corporate tax is only 11% in BC and dividends are taxed based on a grossed up calculation. Though you need to do business tax filing and submit financial statements. Something to look into if u start grossing in the higher income bracket.

  • I’m joining you on a month-long shopping ban for August, but I’m hoping to make it a full year! I’m a little apprehensive with the holidays coming up, but I feel so much better not stressing over my finances all the time. You’ve been a huge source of inspiration for me to finally change my spending habits.

  • I’ve been writing down all my monthly expenses for the last couple of months. I need to know how much I spend, make, save, etc…you mentioned that you tracked your spending for years, I didn’t want to track it for years since that is not my favorite hobby. lol
    Do you think that after 6 months of tracking my spending I would have a good idea of my budget or should I do it longer just to be more accurate?
    Thanks Cait, your posts are always so inspiring!

  • Ohohoh!!!!
    My/our month of shopping ban is a disaster :(
    My son got 15 he needed cloth and a helmet for the motorcycel. The 2 younger sons got a toy each a summertetn and a boat.

    My daughter bought a lot of clothes – she is starting a new school.

    I, myself, bought food, gas to the family and 1 (!) shirt to my self, a secondhand. That´s all :)

    I think it´s guite a good start, because I´ve been selling more stuff, during June and July, than I´ve been shopping !

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