Ugh. Who else hates this word? I am pretty positive that it is the most hated word in the English Dictionary. If I knew how to say in Spanish, French, Chinese, ETC. I would say that its the most hated word in their dictionary too.
SO, with that being said. I am going to let you in on my budgeting skills. Seriously, its a skill. Husband calls me Hitler, and makes a stupid stache with his finger and everything. I am THAT strict on our budget.
A few embarrassing things about me and budget:
1. I do check my account EVERY SINGLE DAY! (which is a good thing because a few weeks ago there were charges on our account that neither of us made, which means someone hi-jacked my card number and were having a all out shopping spree. Luckily for me, I am a Nazi and check my account every day. So they only made it 2 purchases in.)
2. If I check the account and husband has spent one cent on something that is outside of our budget you better believe I call him up and yell at him.
3. Because I run a Budget Nazi
There are millions of ways to budget your money. The best way that has helped Husband and I, is the "Envelope Method". Have you heard of this?
This is how it works.
Step 1. Write down ALL your expenses, and discuss what fits your life/ style with significant other or with your own self:). My list is below so you can see what I mean. These are not my exact amounts, but you get the idea. Note: I do not include things that are automatically withdrawn from our account like mortgage, utilities, and insurance.
Personal Both $50
Personal William $25
Personal Tere $25
Yard/ Garden $20
Other things if you don't do automatic withdrawal like me (because I cant pay a bill on time to save my life or credit) will include Utilities, Car payments, Mortgage, Gas/Electric bill, Internet bill, Health insurance, Home insurance, Car insurance, Kids, etc.
Your "FUN" money is what the Personal envelope will be for.
Step 2. Write each category with the amount on an envelope. Each category will have its own envelope.
Step 3. Total up the whole amount for all categories. This is what you will take out of your bank account at the beginning of each month.
Step 4. Go to bank. Make sure to get SMALL bills. I usually get a ton of $20's, 10's and 5's. I don't even care how many odd looks I get from the Tellers at the bank. If you don't mention small bills they will give you large ones and then it will be hard to divide up all the money per envelope.
Step 5. Put exact cash in each envelope. This is all you get for the month. Try it for the month if its your first time and then decide if you need to add more money or if you over budgeted for a certain category. Then alter it for the following month.
Step 6. NEVER for any reason go outside of this budget you have set for yourself. No matter how cute those shoes are. Its not worth it! Some times I understand that things happen, doctor visits, sickness, just don't budge for the shoes.
IF you pay for some bills with checks, have the checks pre-written with no amount and in the envelope, that way when the bill comes its already written and all you need to do is input the amount. Make the budget work for you.
Don't over due the Personal envelope. $25 is pretty low, but when you think about it how much are you spending on your own personal self. The personal envelope includes your food if you go out with friends, your clothes shopping, those cute shoes, etc. STAY IN THE BUDGET. You will be amazed at how much you are actually spending on just your self. On just food, seriously add it up one day. You will die! Husband and I used to spend a fortune on food.
Husband: Food money is not your own personal food money. It is grocery money. He always
With that being said, if you do decide to budget this way, let all those who are members of the family know the rules of the envelopes. That the money in the specified envelope is for the specified purpose. If you have kids maybe give them their own envelope rather than keeping it with the rest and let them know that, that will be all they will get for the month and to use it wisely. Stick to your word. I don't have kids, but thinking back my parents were always giving me money, don't just give and give. Teach your kids the importance of budget at a young age, and the importance of saving money for future.
At the end of the month if you have left over money, you can choose what you want to do with it. Whether that is recycling it and putting it back into the envelope, leaving it there and adding the full amount for the next month in case you need more the next month, or taking it out and putting it in a "Vacation Fund". This is what husband and I do. We put all the left over money in another envelope (or in the bank and keep track of the amount in the envelope) and use it for vacation money. That way when you go on vacation your using all the money you saved from the budget rather than digging out more money to use.
If you know your going on a trip, make another envelope that says trips. Say you want to save a $1000 in 10 months. Instead of pulling the full $1000 out at the time of the trip budget it out each month. So you have 10 months, you want to save $1000 that means you will need to pull out an extra $100 a month for the trip envelope. You can do this with as much money/ month ratio as you need. This has really helped us out. If feels like your not draining your account for the trip, rather just pulling little by little.
So I hope that this helped some of you. If you have any further questions on how this works, or what I do to apply it to our lives please feel free to comment and ask:)
Also if you have any other tips/ tricks let me know! I am all about saving and budgeting money. Just ask husband.