Ignore Your Budget

For the first year of our journey out of debt, we had a strict budget, with all of our discretionary money spent out of an envelope system. We had an envelope for groceries, one for discretionary spending, one for clothes and one for baby crap. At the beginning of the month, we’d divide the money into the envelopes according to our budget spreadsheet. If we used a card for anything, we’d take a matching about of money out of the appropriate envelope and put it in a box to get reconciled the next month.

Ugh. Almost 2 years later, it has turned into too much work and too much nagging about everything either of us put on a card.

We decided to simplify the system a few months ago. Now, we still have a budget. It’s even a zero-based budget, but we ignore it. We only look at it if something changes for the worse. If something changes for the better, the extra money just gets automatically rolled into our debt snowball, so there’s no need to worry about updating the spreadsheet.

Instead of envelopes, we kind of eyeball it. We budget $450 per month for groceries, so we aim to spend $100 on our weekly grocery run. That leaves some room for losing track of how much we are putting in the cart, or a last minute addition to the list. It also leaves room for our secondary grocery trip to buy bread and milk later in the week. We do go through a lot of milk at my house. We budget $55 per month for diapers, but the deal we are currently getting with Amazon Mom is only costing us $30.79 for 6 weeks of diapers. We ignore the difference.

This—and our heavily automated bill pay and savings—lets us keep our finances on track, without stressing over every dollar or fighting over every little thing that comes home unplanned. I used to fire up Quicken and balance the checkbook every week. Now, that happens at the beginning of the month, usually. If I forget, it doesn’t matter. At the beginning of February, I balanced the checkbook for the first time in almost two months and we never came close to exercising our overdraft protection account. In fact, we had some extra, so that got sent directly to our debt.

Overall, it’s been good to test out a new system. We have almost no financial stress and managing our money takes about a couple of hours per month instead of per week. It’s all win.

Make a Budget

Finance

: Image by r.lovewell via Flickr

In the past, I’ve gone through a detailed series of budget lessons demonstrating how to make a budget and showing my personal budget spreadsheet template. If you weren’t here to see them develop, you probably haven’t seen them at all. I’ve never built an actual index for those posts.

This is the master index of my budget planning resources. As I develop more, this will grow.

Budget Lesson #1 – In this lesson, I go over how we handle discretionary income and I explain our modified envelope system. The discretionary budget contains things like our grocery bill, or the clothes we buy. We have near-total discretion over what is purchased, hence the name.

Budget Lesson #2 – Lesson #2 contains the details of our monthly bills. These are the ones that are consistent, predictable, and actually due each month. Most people take these for granted as the bills they have to pay, but it’s not true. You can get almost all of your regular bills reduced just by asking. You would also be surprised what you can do without, when properly motivated.

Budget Lesson #3 – This is where I explain how we deal with the non-monthly bills. That is, the bills that have to be paid, but are not due on a monthly basis. I also share the personal budget spreadsheet template I developed. I am working on a few sample templates to match various imaginary scenarios. If you’d like to be an anonymous case study, and get free help setting up a budget, let me know, please.

Budget Lesson #4 – In this lesson, I describe our “set-aside” funds for things that will need to be paid eventually, but not on a set schedule. Sometimes, they are never actually due. We set aside money for the parties we throw, for car repairs and for a number of other things. A few of these items are outright optional, but they are part of what makes life fun. You can’t make a budget without including some of the extras.

Budget Lesson #5 – This is the companion piece to lesson 2. Learn how I’ve reduced–or attempted to reduce–each of these bills. For the better part of two years, I called Dish Network every few months to ask for a discount. For almost 2 years, it was granted. Then one, day, they told me they were putting a note on our account to keep us from getting any more discounts, so I canceled. 100% discounts help us save more.

Budget Lesson #6 – This is the reduction companion to lesson 3. These bills are harder to reduce. Have you ever successfully gotten your property taxes lowered?

Budget Lesson #7 – This is the reduction companion to lesson 4. Notice a pattern, yet?

Budget Lesson #8 – Here, completely out of order, is the reduction companion to lesson 1. Watch as I magically reduce–or rationalize–our discretionary budget.

So, dear readers, what part of budgeting should I address next?

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Experience the Live Real Magic

Misc

As some of you have noticed, the link to subscribe by email has changed. While you do still have the option to subscribe to the rss feed through Feedburner, I’m no longer providing the link or recommending it. What I have in its place is an actual email list.

Yes, you can now subscribe to Live Real, Now by email, without having to go through Feedburner. That means you can get all of the updates in your email, for free! This is magic. This magic gives me another option to offer contests and free stuff.

There are two lists to choose from.

The Magic option will have occasional deals, giveaways, contests, and opportunities not available to anyone else.
The Posts and Magic option will send make sure you never miss a post from LRN by landing them in your email inbox. All the Magic from the first list is included here.

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Please, take this chance to subscribe to the magic.

I’d Tap That: Making Life Difficult for Government Spying

Life

Skip to the bottom if you’re familiar with PRISM and don’t want to hear any political talk and rampant violations of our Constitutional rights, but still want to protect your privacy.

For those of you who haven’t been paying attention, the PRISM program is an NSA program to monitor electronic activity.

Lots of electronic activity.

The companies identified to be working with the NSA in this grand overreach include AOL, Apple, Facebook, Google, Microsoft, PalTalk, Skype, Yahoo! and YouTube. For most people, that is the definition of “the internet”. If you’re doing it online, the NSA is–or could be, at their leisure–watching.

This isn’t a crazy conspiracy theory. This is happening, and the government has admitted it. In fact, when this broke, the executive branch’s response was along the lines of, “Don’t worry, we’ll find the guy who leaked this information.”

On top of that, the government has been demanding phone records from at least Verizon on a daily basis.

In addition, the Justice Department was just busted wiretapping Associated Press phones.

Seriously, if you put this in fiction, nobody would buy it, because it’s ridiculous in the land of the free.

As far as the people who say I’ve got nothing to worry about if I’m not doing anything wrong: shut up. You can speak again when you give me your email passwords, bank records, and let me install a toilet cam in your house. What are you trying to hide?

Seriously, there is such a mess of non-legislative administrative regulations that are considered felonies that the best estimate is that most people commit three felonies a day, without realizing it.

Catch your kid with a joint and neglect to call the cops? Welcome to the federal penitentiary.
Use one of those pill planner things to sort prescription meds for your half-senile grandmother? In some states, that’s a felony.

When we live in a system with so many rules that have never been voted on and our legal system refuses to consider legitimate ignorance of the law to be a defense and we have a collection of secret laws that are a felony to disclose or violate, government spying gets far more dangerous.

Many TSA guidelines are secret.
The Banking Secrecy Act of 1970 has a number of secret provisions.
FISA.

The Foreign Intelligence Surveillance Act of 1978(FISA) is the law the NSA is using to justify all of these data requests. The law, that we all must obey, is being overseen by a small subcommittee in Congress, and the FISA courts are just a small subset of the judges. The judges are signing warrants allowing the wiretaps and massive surveillance, but that is clearly unconstitutional and, hence, illegal.

The text of the Fourth Amendment to the Constitution, the supreme law of the United States is: “The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.”

Any warrant that cannot name a place to be searched is illegal.

Any warrant that cannot describe the person to be monitored is illegal.

Any warrant that is not backed by probable cause is illegal.

Tell me how “I want to watch what everyone is saying on Facebook and seize all of the data” meets any of those criteria.

Bueller?

Wiretapping the AP is a serious violation of the First Amendment, too. “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.”

“Congress shall make no law…abridging the freedom of speech, or of the press..and to petition the Government for a redress of grievances.”

Monitoring the press in case somebody breaks a story the government doesn’t want broken is crap.

How can we petition the government for redress of grievances that they call a felony if the company discloses the violation to us? It’s self-serving circular crap.

When you throw the IRS harassing charities working for the “wrong” politics, you start to pine for the good old days of Nixon-level fair play and integrity.

To be fair, FISA got nasty with the Patriot Act, which was an abomination enacted by a different political party. Hey, Washington, next time try to remember that your laws will someday be administered by your political enemies, k? (NSA: I trust you’ll pass the message for me?)

Political talk is over. How do we stop the government snooping?

There are four main pieces to discuss, based on the scandalous Constitutional violations reported recently.

1. Social media monitoring. There’s nothing to this. If you post things on Facebook, the government sees it and knows it’s you. Don’t post anything you don’t want broadcast to the police, your grandmother, and your priest.

2. Internet browsing. There is very little that is secure on the internet. The government can subpoena your ISP and get any records they keep. Unless you go anonymous and encrypted. Welcome to TOR. The Onion Router is a system that encrypts your internet traffic and bounces it all over the world. Once you enter TOR, nothing you do can be tracked, until your internet request leave the TOR system. The system is not centrally owned or controlled, so nobody in the system can track what you are doing.

For example, if I use the TOR browser to search Wikipedia, a snoopy NSA goon could tell I’m using it, and they could tell there was a request from the TOR system to Wikipedia, but they can’t tie one request to the other. If I’m dumb and log into Facebook, I lose that anonymous shield.

That’s solid protection from anyone watching your internet traffic.

How do you use it?

Easy. Just install the Tor Bundle. When you want the NSA to stop snooping over your shoulder because you want to do a search on erectile dysfunction, you launch TOR and the TOR browser and search without having to share your embarrassing secrets.

3. Email. Email is easily the least secure means you can communicate. When you send an email, that message is in plain text, and it bounces from server to server until it reaches the recipient. Any of the involved servers can keep a log of the traffic and read your email.

Never, ever, ever, ever put anything incriminating or important in an email. Don’t send credit card numbers, your social security number, or the address of your meth lab.

But what if you want to have a dirty conversation with your spouse without letting the sick voyeurs at the NSA listen to you ask your wife what she’s wearing and how would she like it torn off?

Use PGP. OpenPGP is a free software encryption program that is basically impossible to decrypt. It’s known as public-key encryption, which means that anybody can encrypt a message to you that only you can read.

It’s like magic.

To use PGP, the easy way(for Windows users) is to get Gpg4win. Install that, then open Kleopatra. This will let you generate your encryption key. You do that by:

Clicking File, then New Certificate
Click Create Personal OpenPGP key pair
Enter your name and email, then click next, then “Create Key”. Enter your passphrase when asked.

You now have a set of PGP keys. To get your public key that others can use to send you messages, right-click your certificate and select “Export certificates”. Pick a path to save the certificate, then do so. You can open this file with notepad to get your public key, or you can email the file out. There is no need to worry about security with this file.

You will end up with something that looks like my public key here:

—–BEGIN PGP PUBLIC KEY BLOCK—–
Version: GnuPG v2.0.20 (MingW32)
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=fHba
—–END PGP PUBLIC KEY BLOCK—–

To get your private key, that you can use with any number of plugins for your email client, right-click on your certificate and select “Export secret keys.”

You can either use PGP as a plugin for your email client, or you can use Kleopatra’s feature “Sign/encrypt files”. To do that, write your message in a file, then select the feature inside Kleopatra. You’ll end up with an encrypted file you can attach to your email that snoopy government man can’t read.

4. Phone calls. This would appear to be harder, since your phone is largely out of your control. There’s nothing practical you do about a landline, except to avoid saying anything sensitive. On your cell phone, you have options, assuming you use a smartphone.

For Android users, it’s free an easy. Install Redphone. If you place a call with Redphone, it checks to see if the caller also uses Redphone. If he does, it places an encrypted call over your data plan to the other phone. Nobody can listen in to an encrypted call. The same company also makes a program for texting.

For iPhone users, you’re stuck with Silent Circle for $10/month, which may be a better option, since there is support for more devices, including Android. It was designed by the guy who designed PGP and handles texting and email, too.

That’s it.

There you are, the whats, whys, and hows of modern, hassle-light, private communications. Doing what we can to foil bad government programs is our patriotic duty.

Sunday Roundup: Ice Fishing

Misc

Ice Fishing in Portland, Maine — Image by Captain Kimo via Flickr

Update: Something wonky’s happening with this post. If you’re seeing it in your reader again, just ignore it.

Twenty years ago, my grandparents were living in Arizona. They went to see Grumpy Old Men in the theater and, during an ice-fishing scene, they overheard the people next to them talking about how impossible it was. You can’t walk on the ice, let alone drive there! Naturally, my grandparents corrected them.

For the uninitiated, in the land of 10,000 frozen lakes, ice fishing is an actual pastime. The ice on a lake can reach 36 inches, which is more than enough to drive on by 24 inches. Ice-fishing aficionados will drill a hole through that frozen mess, drop a line through the hole and find dinner. Last night, I went ice fishing for the first time in at least 10 years, probably 15. On the lake we were on, they actually plow roads across the ice. It sounds cold, but we were in a 20-foot fish house with a generator, a couch, and a TV. The neatest thing was the underwater radar thingy that turns ice-fishing into a video game.

30 Day Project Update

This month, I am trying to establish the Slow Carb Diet as a habit. At the end of the month, I’ll see what the results were and decide if it’s worth continuing. For those who don’t know, the Slow Carb Diet involves cutting out potatoes, rice, flour, sugar, and dairy in all their forms. My meals consist of 40% proteins, 30% vegetables, and 30% legumes(beans or lentils). There is no calorie counting, just some specific rules, accompanied by a timed supplement regimen and some timed exercises to manipulate my metabolism. The supplements are NOT effedrin-based diet pills, or, in fact, uppers of any kind. There is also a weekly cheat day, to cut the impulse to cheat and to avoid letting my body go into famine mode.

I’m measuring two metrics, my weight and the total inches of my waist , hips, biceps, and thighs. Between the two, I should have an accurate assessment of my progress.

Weight: I have lost 29 pounds since January 2nd! That’s 4 pounds since last week. 13 more to meet my goal for February.

Total Inches: I have lost 15 inches in the same time frame, down 1 since last week.

Best Posts

Thinkgeek has a new high-protein, low-carb snack. Did you know that toasted ants taste like bacon? I’m far more tempted than I should be.

On the off chance that somebody has missed the memo over the years, tax protesting–the art of ignoring your taxes because you don’t like them–will not end well for you.

I’ve been fighting an urge to get a Kindle. Over the last few weeks, the itch has been getting harder to ignore. Money Crashers has a list of resources for free ebooks, making the itch that much worse.

That’s two posts on spending money. Here’s one to balance that with making money. Do you know the best time to post an eBay auction?

LRN Timewarp

This is where I review the posts I wrote a year ago. Did you miss them then?

Have you ever participated in a financial binge & purge? Budgeting and planning can help you avoid the purge, but you’ll have to forgo most of the binges.

Everybody gets caught by life’s ups and downs occasionally. When that happens, how can you fix the damage to your budget and finances?

Finally, I explained my plan for shopping quickly.

Carnivals I’ve Rocked and Guest Posts I’ve Rolled

Brown Bagging Your Way to Savings was included in the Festival of Frugality.

Debt Burnout was included in the Carnival of Personal Finance.

Thank you! If I missed anyone, please let me know.

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