Budgeting Lessons...AKA OH CRAP!!

My goal of making & maintaining a monthly budget went great for January, not so for February...

Previously I had no method at all. I would just pay the bills when they came in, and then check them off of a list for the month to make sure I paid them all. If we had extra money we would spend it.

My financial genius friend, Katie, helped Joe and I come up with a budget. Katie is the wife of one of guys that I work with and keeps the best financial records I have ever seen! Someday I would like to be Katie! Anyways, we did great sticking to the budget as soon as it was implemented. Joe was wonderful about not spending more than the amount he was allotted. He did spend extra a few times, but it was always to bring me lunch at work (how do you complain about that!). We were saving more, spending less, and I felt on top of our finances!

Then this month, my old habits kicked in while I was still trying to maintain the budget (Katie you should stop reading at this point...it will only disappoint you!). It all happened one day at work when I checked the exchange rate between the dollar and the won. When we first got to Korea the rate was almost 1:1. With the current economic disaster, the dollar to won is 1:1.5. Since we pay our rent in won, if we exchange money when the rate is like this we get "extra". For the last couple
months our 1200 dollar rent, has turned into 900 dollars or less per month!

So two weeks ago when I checked the rate and it was really good, I logged onto my bank account and saw how much money was there. Then I transferred 500 dollars to the bank account here to be withdrawn in won. Joe went and got the money and we had "made" extra won!

Then I got a rude awakening...an overdraft fee! In fact there were two of them, each 29 bucks!

My old way of doing the money collided with the new way! I forgot that now every dollar is accounted for. There isn't just 500 extra dollars built into the budget! That money is already earmarked for something else. Damn it!

Well even with paying the 58 dollars of overdraft fee, we still ended up ahead by exchanging when we did...but it is still infuriating!

Lesson learned...