January 18, 2010

Budget Ideas




I've learned what works for me through trial and error. I hope that some of this helps you too.

A little background: Sweet Hubby gets paid twice a month so everything we do is based on that schedule. We use online banking. All of my accounts are at the same bank and I can easily transfer my money around and pay my bills. I highly recommend this as it makes life so much easier.

Have a goal and stay focused on it

The background on my computer screen is of a house in the Village. I see it several times a day and it serves as a great reminder. When I'm shopping and find something I want to buy, I ask myself if it's a need or a want. If it's a want, could I just as easily get it a year from now? Do I want it bad enough to delay my goal? I also love to talk about our goals with Sweet Hubby. It's exciting to dream together and good for our marriage. Also, I love to watch Suze Orman and Til Debt Do Us Part on MSNBC. Those shows help keep me focused and excited about what I'm doing.

Make a budget
Be realistic, make adjustments as needed but make a budget. See where you can cut back. Can you consolidate your cable, computer and phone into one and save money? Can you do a better job of menu planning and save money on groceries? Can you combine errands in to one trip so you aren't running around all the time and using more gas?

Use cash
Look at your budget and decide how much cash you need for that pay period. I then sort that money within my wallet. I hide my personal money, the grocery money goes in the main area and if I have money I need to set aside for clothing or entertainment I keep that somewhere separate too. I am much more aware of what I am spending when I use cash. I only use my debit card for gas or unexpected expenses.

Pay yourself first 
This is the most important tip I have for you. Pay your bills, take cash out of the ATM for food, clothing and entertainment and decide how much you need to leave in the checking account (for us that is enough for gas plus a little extra just in case money) and then send the rest off to savings or to pay off debt. I used to take whatever money was left at the end of the month and put it towards debt or savings. I never had even close to the amount of money left over that I should have had. Then I started treating saving/paying off debt as a bill. Now, on payday, I figure out how much money I should have left over at the end of the payday and send it right to savings/debt before I can spend it. Since I started doing this, I save a lot more money. It's so simple and effective. It was a little scary the first time I did. I only left about $150 in my checking account that first payday but I knew I could always access my savings in an emergency. I also knew there was no way I was pulling money out of savings to fund new shoes or whatever must have item I might find. This method forces me to behave and guess what? At the end of the pay period I still had money left.

Track cash expenditures  I have a simple spreadsheet that I use to track where my cash has gone but you can just as easily use a notebook. It can really be an eye opener to see where your money goes.

Put everyone in your house on an allowance
For the most part, we buy things our kids want for holidays. We get them what they need when they need it. We don't tie allowance to chores. Maddie doesn't get allowance because she has a part time job but she still does chores. Emma is 8 and gets $9 twice a month. When she wants something she knows that if she doesn't have the money for it she must save up. She is very good with money and thoughtful about her purchases. Even Sweet Hubby and I get an allowance. How much is a personal decision but everyone needs a little fun money (flea markets and magazines, right?).

Send away extra money immediately
When you get extra money like a tax refund, send it out of your checking account as quickly as it gets there. If you leave it in your account you will talk yourself into spending it. This week we got an unexpected refund from our property taxes and immediately transferred it to savings. In the next 2 months we will get a tax refund and Sweet Hubby's bonus and both will be sent away immediately.

Stay away from temptation
For me this means crafts stores, Homegoods, Target and antique stores. If you can't behave at SuperTarget, don't get groceries there. If you can't resist online shopping, delete the emails from those stores without opening them. Can't resist a catalog? Recycle it without looking at it. The point is to take away the temptation until you are strong enough and focused enough to resist.

Don't use credit cards
If you don't have self control, don't carry them.


Balance your checkbook often
I balance mine on Monday and Fridays. I know at any given time exactly how much money I have.

Let yourself have some fun
We love to eat out and still occasionally do but there usually isn't a waitress involved in this interaction. We love to go out for ice cream so we go to McDonalds for $1 cones. We check out movies from the library for free or the Redbox for $1 a night. We go to the bookstore and browse. We go to the Village and have coffee and walk around. We play games. We read books from the library. We have play dates.

Pay yourself again

At the end of the pay period I send whatever money is left in the checking account off to savings/debt and start over with a zero balance for the new pay period. Then the fun begins all over again.

22 comments:

  1. Mornin' Jen! I'm so thrilled for you and I love reading about all that is going on in your world. I'm so excited about your future nest...giddy as a matter of fact. Cannot wait to see it all on my screen. Great money post today. :)

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  2. I just found your blog and it is lovely. Great tips for a budget. Thank God that we are blessed and we can save and spend a little. Happy Monday.

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  3. Great advice! I now throw ALL decorating catalogs into the recycle bin the minute they come through the door. That way I won't be tempted to leaf through them and find something I "think" I can't live without!

    Kat :)

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  4. Those are great tips! You are a very disciplined person, something I am striving for in the new year in many areas of my life.

    LeAnn

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  5. Morning Jen. Wonderful post and can't wait to read more! I'm new at this:) Have a blessed day! Jenn

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  6. Great advice Jen! The trick is to not totally deprive yourself of things you like to do so you won't be tempted to stray off your budget. Looks like you found the right balance. Hope your house searching on the weekend was enjoyable!

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  7. Hi Jen :)

    This was such a great post! Rich gets paid the same way, so I can follow this exactly.

    Did you find your dream home in the village yet?? ;)

    rue

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  8. Those are all tips to live by! For the longest time, Cory and I both got paid ONCE a month. It freaked me out so much at first, but it was good for us, because it forced us to really know how much we needed to budget for each thing for the month. Now, I get paid 2x/month, but Cory is still monthly and we still do our budget for each month. I shudder to think of what our life would be like without that stinking, blessed budget!

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  9. Great tips...great tips. I'm helping my sister now with the envelope cash system. It's really opening her eyes to how much foolish spending she's been doing. I'm so blessed that we have no bills, debts or mortgage. I still try and stay on a budget though. Being home full time has made a world of difference. I still shake my head that the fact we have MORE money now that I stay home, than we did when I worked part-time. I never go to the mall, you can't want what you don't see. Craft stores are my downfall unfortunately. Is it ok to make a monthly yarn budget?

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  10. Great, great tips! Thanks for sharing!

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  11. Great post Jen. My problem is I don't follow through with the budget. What you wrote makes such sense, gonna try to put in action. I am taking my neice to Indy for her bday to shop and spend the night What are some great places to go.

    Bristol

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  12. great advice!! We just were visited with identity theft, so I would add, check often your online balance as it goes fast, we missed a half a day, and they spent almost $1000. We will get it back, but it is an inconvenience. keep on keeping Jen Jen.

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  13. Great tips Jen! I'm going to start tracking my cash...it just seems to disappear. And, I am one who can't behave at Target, so I probably need to just stay away!

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  14. This is a fabulous post! I love what you said about leaving not very much in the checking account. I have never really thought of it that way. We do cash for groceries and have allowance but I have always liked having 'alot' (relatively speaking) in the checking acct. - Just in case. And we all know what that means.:) My hubby gets paid on Friday and I am going to try this then! Thanks!

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  15. Good advice... and well worth doing. I pay myself weekly with housekeeping and find that only having that finite amount in my account means I only have that finite amount available, so I can't overspend one week and starve the next.

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  16. Great tips. We discovered Dave Ramsey a few years ago and have been trying to live that way. It's hard and we haven't always succeeded....like the laptop that was an impulse purchase last year on a zero percent promotion. It was paid off in a few months but boy did I kick myself for not saving for those months and then purchasing it with cash. My biggest problem is the cash part, it doesn't always work for us and we tend to spend more. So I signed up for a savings account at my bank that automatically transfers $1 to savings every time we use debit. It's amazing how fast it adds up.

    Thank you for your comment on Casey's passing.
    ~Michelle

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  17. Thanks for the great money reminders!! We can't read it enough. Please stop by my site today....I have something for you!

    Shellagh

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  18. hi jen,

    gosh, what a timely post. my credit card bill just arrived with all of the holiday spending on it. at least it is a points-earning card, something i recommend.

    thanks for all of your tips, sweetie. i'd love for you to stop over to my blog to see the boys' room. any ideas are welcome.

    xo
    elyse

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  19. Great ideas Jen!!! I do alot of the same things you do! And I love watching Suze Orman as well! :)
    Kristi

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  20. Hi Jen,

    You might want to check out the Dave Ramsey website: http://www.daveramsey.com/ His financial program is similar to the ideas you put in your post. His principals are widely know and used by many. My husband and I went through his Financial Peace University classes at our church right when we got married and we are debt free and purchased our first home together last spring. Many blessings for your goals!

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Thank you for taking the time to say hello today! I always love to hear what you have to say.