Advice on living on $3,000 net a month

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Assume you have a job, which is quite a feat nowadays with some 20 percent of Americans unemployed, and assume your monthly take-home check is $3,000, which is not bad in this economy. What can you afford? How should you budget your life so as not to lose your house?

There are those clever ones who offer an accountant-like book-keeping method of having a ledger with one side for income and one side for expenses, and trying to make sure the two sides balance. This is as useful as asking one to ration licking a melting ice-cream cone on a hot summer day.

So, here is another way of working through your personal budget, both conceptually and practically. We are working with $3,000 take-home paycheck that in fact translates to having $100 per day to spend on whatever you want. This sounds quite cool, if you don’t have to pay rent and utilities and all the rest. So, let’s do it this way: your rent or mortgage is $900 per month, utilities about $300 monthly average, your cell-phone about $120, your cable and wireless at home another $150, car payment of $500 and car insurance of $100 per month. Hopefully not all your bills have to be paid on the same day. If not, then this is what you may want to think about.

Pay your rent or mortgage on the first day of the month, and know that for nine days ($900/$100=9) you cannot spend any money on anything else!!! On the 10th day you can go grocery shopping but spend no more than your daily allowance of $100. On the 11th day you pay your utilities bill and now you cannot fill your car with gas or stop at the bar till the 14th day. Enjoy this day of tank-full-of-gas ($40) and bar hopping for $60. On the 15th day you make your car payment and must wait till the 20th day to pay your car insurance. On the 21st day you go out again and buy groceries. On the 22nd day you pay your cable/wireless bill and your phone bill. The 24th day opens with new possibilities of six daily free-spending of $100 per day till the end of the month!

With six days of absolute frivolous enjoyment, some guilt may creep in to save $100 for a rainy day … oops, the six days become five. Incidentally, the savings rate in the U.S. has jumped from a historically-low 1 percent to close to 6 percent in the past few months. What if I need a new appliance? What about new shoes? Will my credit card help? Absolutely not! Your credit card is your No. 1 enemy in this system of personal budget responsibility! Hold onto it for emergencies only!

As for the small joys in life, the ones you see in television commercials beckoning you to spend more and rescue the economy, try to ignore them. Think deep thoughts and meditate, go on long walks and read library books (they have DVDs too). And if all fails, a bottle of wine or a six-pack shared with friends can stimulate a conversation about politics, religion and sex: what else do you need for semi-free entertainment?

Raphael Sassower is professor of philosophy at UCCS and worries daily about budgets.