Sunday, March 18, 2012

Household Expense Book 1978 Pt. 3

I'm back! Was on vacation for a couple of weeks then catching up.

Another installment in this ongoing series:

Reminder: I was thrifting (shopping at thrift stores) last fall and found a budget book. One that you record expenses in each day and total up for the week/month/year. I knew it was old but thought it was blank. It was 25 cents. So I got it. I like to do a money flow check up once or twice a year so figured the 25 cent budget book would get me through about 6 years. Seemed like a good deal.

When I got home and was putting my purchases away (the budget book and a puzzle of a Cezanne still life, 25 cents) I flipped through the book a bit more thoroughly and found that a few pages were filled out.

It was done in September and October 1978. Quite interesting. I noted that I pay less in rent now than the book's owners (we'll call them "they") paid on their rent/mortgage in 1978. So, I thought I'd put the expenses in the blog and think them through in writing rather than just in my head.

Here goes:

Totals for the week beginning 9.25 (had to reconstruct the date from preceding and following entries):
Meats 45.00
Groceries 38.50
Dairy Products 4.50
School Expenses 2.00
Church-Charity 10.00
Drugs-Medical Care
Beauty Care 5.00
Household Help
Entertainment 35.00
Beverages 2.00
Cigarettes-Tobacco 10.50
Household Purchases 10.00
Wearing Apparel 1.50
Gifts 7.00
Telephone 73.00 (!)
Gas 52.86
Electricity 15.17
Heat 5.61
Rent Or Mortgage 370.00
Auto Expense 73.00

Additional Categories were added as follows:
Aldens 36.29
Penneys 10.00
Alarms 39.87
M.C 25.00
TV Guide 15.50

Total for the Week: 880.30 (wow!)

It appears that the "Gas" is being used to record "gasoline" rather than furnace fuel as it has a daily entry.

Spent a ton on meat and groceries again. I just decided to eat buckets of organic vegetables again and at today's prices I'm having trouble spending that much...even out of season and these folks are buying in 1978 dollars during harvest when stuff should be cheapest. Even assuming 4 kids. That's a great deal of money on food. Percentage wise it's not too terrible. Meat, groceries and dairy total is $88.00. 10% of the weekly budget. Of course the budget is skewed with a few monthly expenses like rent/mortgage.

Once Again, I'm a bit taken aback by the Entertainment cost of 35.00. What the hell was there to do in 1978 that cost that much? High class hookers? One for each kid?

The Cigarettes-Tobacco is 1.50 per day. Must still be smoking a pack a day.

One red flag as far as financial planning is making categories out of stores..."Aldens" "Penneys." Budgets do best when the categories are types of spending, not locations of spending. Did you buy clothes at Penneys? Is Aldens groceries? Clothes? Garden implements? This is the start of not knowing where the money is going. In a week or a month or a year, how will the author know what was bought at these locations? Whether the purchases were for home use or gifts?
What is "M.C"? What was bought there? For whom? Bad biscuit (also, no savings).
Another red flag is not recognizing "TV Guide" (I hope that's a yearly subscription) as an Entertainment expense. Making the entertainment budget a mind-boggling $50.00. Maybe the hookers wanted to know what was on TV. It doesn't really matter as it's still an entertainment expense.

One final red flag on this is the fact that the author never fills in the "budget for the week" column. Perhaps the point was just to track expenses for a while and then figure out a reasonable budget limit in each category. It's one way to go. Yet, making sure the outflow does not exceed the income is another goal of most budgeting and without having even a target total or a note of what the income is, makes it hard to keep a daily, weekly or monthly eye on things.

The weekly total, $880.30, equals what is often my monthly total 24 years later, minus various savings plans e.g. vacation, real estate, car.