Checking Account Cushion = Extra Cash

I track every single purchase that I make in my budget spreadsheet. At the end of every month, I reconcile my budget and put my leftovers into savings, which is usually my E-fund and Roth IRA.

As of today, I have $995 in my checking account which seems abnormally high! I made sure that my full rent amount for next month is waiting in my brick & mortar savings to be debited and sent to my landlord via automatic bill pay - yes, it's all there. So it wasn't because I missed putting that away. After the rest of my monthly automatic expenses get debited and I pay my roommates for utilities/cable for September and spend about $100 from now til next week's paycheck and save my September monthly leftovers, my checking account will still have $500 in it!

I went back into my spreadsheet and went through each month (different tabs) to see how much I had leftover after putting the leftovers in savings. Sound confusing? Let's say I had $200 leftover for a particular month, which is after all my expenses and savings is done, including $200 to my Roth IRA and $250 to Emergency/Travel/Gift/Car Funds. I would probably split $175 of the remaining $200 between my E-fund and Roth IRA, or whatever I feel like adding to in that particular month. So that leaves me with a $25 cushion. Some months seem random, it looks like I've left as much as $80 unallocated to just sit in my checking account.

I like a cushion, but I don't need THAT much of a cushion! After all, I have $1,000 for random emergencies in my b&m savings which I can access/transfer immediately. Usually I leave around a $250 cushion in my checking account, but it looks like over the past 8 months, I've been leaving enough that it slowly built up to $500!

Now I am trying to figure out what to do with it! After all, October is the other 3-paycheck month of this year and I will be saving almost all of that extra paycheck anyway. Essentially, I am giving myself $250 to play with! I am thinking a new pair of designer jeans and some shoes/accessories, or new workout shirts and a sports bra... I'm not big on gadgets, my camera and iPod work great even though they are both a few years old.

Any suggestions, or should I just go shopping?! :) Happy Friday and enjoy the weekend!