Houston, we have a problem.

At some point yesterday, I realized there was too much month left at the end of the money. I figured surely there was some kind of mistake.

Since I’m up to my eyeballs in work right now, I vowed that in the evening I’d review my spreadsheet and try and figure out what the heck kind of error I’ve made. Now that I’ve reviewed the bank statement, and my spreadsheet, I see there is no error. The only thing that is clear is that I’ve been a dufus!

I’m projecting about a $700 deficit in August. God, I hate saying that.

According to my spreadsheet, I’m in the black by about $94. For me, being $94 north of zero is bloody brilliant. So, why will I come up short at the end of the month?

Cash flow.

Some of you may recall that I went on a little spending spree in July. When I was able to balance the books in July, I was mystified. In my month end report, I mused about how I had no idea how I managed to balance the books. I said “There’s a little nuisance on my shoulder who keeps asking me “aren’t you forgetting something?” It’s possible, but for the life of me, I have no idea what it could be.”  The little nuisance has spoken.

Here’s how easy it is to cook your own financial goose:

  • I pay the mortgage every other week.  In July, the payment was due Friday July 30. I had counted on spending that mortgage money in July, and my spreadsheet reflected the payment.
  • End of July came and went, and things were looking good.
  • Now, almost the end of August, as I review my bank statement, I see the July 30 mortgage payment didn’t clear my account in July. It came out August 3.

Since I moved money here and there, and didn’t actually look to see if the payment had cleared the account, I only put August’s money in my chequing account, instead of August’s money plus that one mortgage payment from July. Oh, and another cheque I wrote at the end of July for $85 didn’t clear until August.

In order to stop the bleeding, somewhat, I have taken the money set aside for August for entertainment and dining out and a few extra bucks from other envelopes and deposited it in the bank. This brought up the balance by $126. Not going to solve the problem, but it at least demonstrates as much discipline as I can execute with only a week left in the month.

The frustrating part is this: normally I look at all the costs that are at the end of the month and are yet to clear my account. For whatever reason, I didn’t do that in July. A costly mistake I hope not to repeat this calendar year.

You can anticipate a failing grade for August. You can also anticipate me paying more attention to that nuisance on my shoulder next time!

The big picture is still good. I’m still putting money toward retiring my debt. Still putting a pittance of money toward emergency savings and retirement savings. Still putting money into savings vehicles for the girls post secondary. Still paying all the bills on time and in full. Still excited thinking about the day I’ll be debt free. This is just one of those little hurdles along the journey. While today I’m thinking “Houston, we have a problem”, I’m confident that the mission will be a success.

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2 responses to this post.

  1. Posted by Busy Mommy of 3 on August 24, 2010 at 11:19 am

    The jar system is the reason why this happened to you.

    Don’t get me wrong. I like Gail’s money advice, and I follow most of it – except for her jar system. It would be too much work to take the cash out every week and figure out how much to leave in the bank for automatic withdrawals and cheque writing. Instead, I use debit everywhere I can and withdraw an allotted amount of cash once per month to stash in my wallet. I follow my budget by using a spreadsheet with a running total for the current and next month. It lists everything going in and out, and I can see where I stand at any given moment, and weeks into the future.

    Reply

  2. […] About Middle Class Mom in Toronto « Houston, we have a problem. […]

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