Frugal Confessions — Live a VIP Life on an Average Paycheck

I’ve got a confession to make: we don’t record our purchases, carry around envelopes, fill up jars with anything other than home-canned Meyer lemon marmalade, or use excel to meticulously track our budget each month.

I’m just not that kind of a person.

Yes we have our finances worked out. And yes we know how much money we have coming in and approximately how much bills are going to cost each month. We’ve never actually overwithdrawn on our checking account, and the only bill we ever missed was during a ‘changing-of-the-guard’ experiment while working through financial friction in our household.

We have a solid handle on our finances without lots of the work people think is involved.

So how do we get away with this?

Internal Thermostat

Instead of performing all the maintenance usually associated with the word ‘budget’, we do a once-and-done master key, set our internal thermostats to it, and check in periodically.

Set Up the Once-and-Done Master Key

We’ve set up a non-high maintenance money funnel that works for us as step one to our system. This means that yes, at some point we sat down with an excel sheet to work out what our monthly bills are (both fixed, like home mortgage, and variable, like electricity), what our income is, and how much we can automate towards our savings goals (income – spending = retirement + permanent savings + travel fund).

This was after plugging our info into and associating each of our financial accounts. The cool thing about Mint is that they can bring in between 30-90 days of historical spending/earning data within hours of you signing up so that you automatically get a clear picture of your variable spending needs by category based on real historical data (love instant gratification!).

Based off of our figures, we set up automatic bill pays and automatic savings withdrawals so that we know each  month that we will have $XXXX (or $XXX) amount of money left to cover those variable expenses.


Now the trick is to stay under this extra amount left in checking.

Then We Set Our Internal Thermometers to the Variable Values

For ex-environmental investigators like myself, this means we calibrated to our new numbers.

You see, your brain has these sort of internal triggers to know what is and is not normal. So you need to set your new “normal” for the various types of variable spending in your once-and-done master key so that you start getting the inner alerts when you get close to these numbers.

And by “set your normal”, I simply mean look at the numbers in your Master Key and sort of sear them into your head. For example, we’ve allocated $350/month for groceries. Since I go grocery shopping twice per month I know that each trip I can spend approximately $175. Or if I go crazy-with-the-cheese-whiz one trip (no, I don’t buy actual cheese whiz), I mentally subtract that from the $350 and know that I can spend $XXX on our next trip to even things out.

And let me tell you, this internal thermostat can get ridiculously precise.

I have a killer internal thermostat when it comes to things like grocery shopping. I’ve gotten so good that sometimes I come within a dollar of our $175/trip budget without having used a calculator or anything! It’s like… I just know that I’ll have to skip out on those Dove dark chocolate almonds this time because I picked up a clearance organic meat special (triggered by natural alerts set off by my internal thermostat).

It just balances out.

Check Up As Needed

It’s not a good idea to completely run your finances in your head — especially when you’re new to the process and your internal thermostat might not have been properly calibrated.

And when you start feeling those triggers, you should check up on things anyway (triggers can really be anything, like “that voice” or “gut feeling” telling you that you shouldn’t purchase X because you’re close or over your limit).

So you’ll need to check up on things from time to time. You can do this by logging into if you’re on there, or simply by opening up your banking account/credit card account and taking a look at things weekly, bi-weekly, or whatever feels comfortable to you.

Just like seasonal changes mean you have to reset your home’s thermostat, as your life changes you’ll need to reset your money thermostat. A sure sign of when it’s time to relook at that master key is if you find yourself juggling between categories and robbing Peter to pay Paul several months in a row. It might simply mean that you need to allocate more money into the groceries budget and a little bit less money towards savings in order to relieve some of the stress that you’re feeling. But overall, once you set the master key, then set your internal thermostat, you’ll take a lot of the maintenance part of keeping a budget out of the equation. It’s really pretty cool!

This is for my Australian readers. A pre-existing condition is defined by medical insurance providers as any injury, illness or other affliction that has been treated, medicated or evaluated professionally in any way during a predetermined length of time known as the “look-back period.” These conditions are ineligible for treatment under many standard policies, and […] Read More

There is one thing that you can do to make sure your financial decisions are as sound as possible. Sounds nice, right? I mean, it can be daunting to make financial decisions as is, so finding a way to ensure you're making the best possible ones sounds like something you should spend some time on. […] Read More

"I am not good with money." Has this thought ever scrolled through your mind? Maybe it pops up after reading one of those debt payoff success stories -- very inspiring, yet when you look at your own situation you think it could probably never happen. Or after getting another surprising-yet-not-surprising credit card statement where you […] Read More

We Don’t Say No, We Ask How

"Wanna eat out at our favorite Mexican place?" Nope. "How about we go see that new movie?" No. "I really want a flat screen television." Heck no. This used to be the extent of our want/wish conversations...particularly right after Paul and I got engaged and decided to finish paying off the last $25,000 of our […] Read More