Budgeting for the Year

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Procrastination. One of my worst enemies. Even for things I love doing like writing my blog, brewing some delicious home brew, or going for a run; I can always find something far less productive to do. My keg of home brew is empty. Blasphemy! The blame lies squarely with myself. What on God’s green earth compelled me to record all six Star Wars movies on May 4th is beyond me. Then I freaking watched them…ALL twelve hours of them. Let’s get back to drinking good beer, saving money, kicking debt’s ass, investing wisely and of course making budgets so we can do all those cool aforementioned things. Full disclosure is I continued to drink some good new craft brews while watching all those damn movies so it was not all a waste. With that kind of beard, George Lucas totally looks like a stout on nitro kind of guy.

So do we all remember how to do that sweet and simple monthly budget plan I told you all about a few months back? Of course you do. We are going to expand that monthly budget to an annual budget. We all know certain bills and beers are seasonal and cannot just be copied from month to month. I pay my trash and sewer bills every three months just like Jim Koch brings us a Spring Ale, Summer Ale, Oktoberfest, and Winter Lager on the quarter.
So here you can see the small differences in Misc Expenses in February from January:

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Notice the formula for the monthly ending balance of February. It takes into account the money you had left over at the end of January (B26) and incorporates that value into February’s budget. See simple.

From here you can copy and paste March through December and only have to change the names of the months and your miscellaneous expense names and their corresponding amounts. You will have to take into account that if you are paid bi-weekly two months out of the year you will get an extra pay per month. This example shows us getting paid each week so that extra pay will happen four times per year. See that in March we got paid five times for the five Fridays in March:

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This five pay month of March is where the beauty of a budget really shines through. You have been budgeting the previous two months to live on four paychecks per month. Then you get a fifth and boom! You have an entire extra paycheck to do whatever you want with. Really what I mean by “do whatever you want” is your going to pay down extra debt because here at Budgets and Beer we freaking despise debt, or you are going to put extra money into a savings account, or in this case we added more money to our Vanguard account. Half the reason we budget wisely is to that we can eventually become financially independent or dare I say it, drop the mic and retire early!

I have to applaud you. Like the true hard working baller you are; your boss gave you a raise in the month of April and you decided to reward yourself with a Brew Fest. And just like any wise craft beer drinking individual you only used half the extra money in April for the Brew Fest and used the other half to put extra money in your savings account. Well played.

Finally, I like to keep track of a number of things on my budget throughout the year. I make a formula to track my total annual income, how much I have tossed at my loans, and how much I have put into my savings account. Here is the simple formula I used to add up all of your total 2017 income and an example via the test budget we have been using:

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Well that wraps up our mock 2017 yearly budget. You made $54,950, paid off $11,825 in loans, and saved $6,200 throughout the year. At this pace you will have paid off the average student’s loan debt in a little under three and a half years and have saved a little over $20,000. Not to mention what you invested in that same time frame. You’re a freaking rock star! Well I hope you learned something, enjoyed following along and can now make a use this simple budget system on your own.

My beer of the blog this week is Tröegs Independent Brewing Company’s Crimson Pistil IPA. When you pour this delicious beer you should instantly notice the dark pink/rose color of the IPA coming from the hibiscus blooms used during the brewing process. Two styles of hops swirl around on your palate. Lightly tart citrus flavors combine with berry like floral hops leaves room for just a little malty sweetness that squeezes its way through. Subtle tropical flavors at the end leave a summertime feel on your tongue. Cheers!

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