Budgeting
Moms View Message Board: General Discussion: Archive January 2008:
Budgeting
I've never been very good at budgeting but, since I'm better at it than my dh, I'm stuck with the job. Most of our marriage, we've lived fairly paycheck-to-paycheck and juggled bills and unexpected expenses as they've come. We are both working and are making enough money that we shouldn't still be scrambling to make each payment. When I write out our income vs. expenses, we should be doing much better than we are and I'd like to change that. Unfortunately, dh is very vocal about supporting my ideas but when push comes to shove, he balks. He won't have his check deposited in our checking account, won't go to automatic payments on our regular bills and can't/won't give me his receipts from purchases. It's not that he refuses, he just loses them, leaves them at work, washes them in his pants pockets, etc. He's completely unorganized and I'm not sure how to "fix" it. I've tried giving him an allowance but he'll use that money to put gas in the car, pick up an extra gallon of milk, or for the kids' lunch money.
We try to make up a budget like electricity bill=x amount, phone=y, groceries=z but we always come up on extra expenses. This month, it's 5 birthday parties, fundraisers at school, baseball signups, and field trips for all the kids. We didn't know ahead of time about any of these but they add up to several hundred dollars! We have no savings, no extra debt and no credit cards. We've tried an all cash, envelope type system and it didn't work at all. A friend swears by Microsoft Money, which we don't have, but we have Quicken. Are they similar? If my dh is so bad at keeping track of his receipts, how can I track his expenses with a budgeting program? Has anyone dealt with these challenges and found a solution? I know we aren't the only ones who've had this problem, but I don't know anyone who has managed to stick to a budget in spite of it. If you have, will you PLEASE give me some hints, tips, encouragement or just share what worked for you? Thanks!
Going anon because I HATE admitting that we are struggling financially, in any way.
No clue but I feel your pain... LOL
I may have something that might help a bit. Email me at e n c h e n s @ y a h o o . c o m and I can send you a link.
No spaces, of course.
Why won't he do a direct deposit? And, if you're in charge of bills, I think you'd have the "authority" in doing automatic payments.
And, to be honest, if he can keep track of money...he should keep track of receipts too. If that doesn't work, only give him cash and let him use the debit for gas only. That's what we do...Scott and I have a $20 a week budget (each) for extras like Starbucks, snacks, etc. Every Friday, I get $20 out for each of us.
Do you at least have a debit card so you can check online on your checking acct?
Online banking. Direct deposit is a must, you need to allow no debate on that. Online banking eliminates the need for receipts because the purchases show up automatically. I'm very good at budgeting, if you would like more specific advice, you can email me cjaping at gmail dot com.
It sounds like you are trying to do a budget. You DH NEEDS to be responsible. Ditto Heidi - why won't his check get direct deposited? That's fishy to me. What does he do with all that money? I think an allowance sounds like a very good idea for you guys as well. Ditto Heidi again - take away the debit card and go to cash only for him.
For all the 'incidentals' with kids - first not EVEYRTHING has to be purchased so start picking and choosing more. You mention fundraisers - if you're trying to stay more on track you need to eliminate that for a while. Buy one small item. If you have 4 kids and they're all doing fundraisers, buy 4 SMALL items or see about making a donation that you can afford. The incidentals for kids should be included in your budget in the sense that you have a fund for them - birthday parties for instance. Ask yourself are we spending too much on these? How could we cut back on the cost of gifts? I have no idea what you're buying, those are things that are just coming to my head.
We have a budget like you mentioned )gas=x, electricity=x, etc. What is leftover free and clear is in the back of my mind every month and when something 'comes up' that would come out of that total, a mini budget comes up in my head. for instance, we had an unexpected $197 medical bill that came through for a procedure not covered by insurance. Ridiculous, I fought it, that's beside the point, we still have to pay it. That will affect the rest of the 'extra' $ leftover this month, meaning anything that 'comes up' that puts us over our total leftover gets put on hold until next month. With regard to birthday parties, I would just scale way back on the amt. you're spending on each gift. You also have to know what is going to happen at certain times of the year. (Ex, it's football season so we have football expenses) We have 6 family birthdays in February, along with Valentine's Day and our anniversary immediately after. February is an expensive month for us, so we know going in that all of our leftover money is pretty much accounted for and anything else would have to be pretty important to spend $ on it.
Well that was major rambling but honestly, it takes two, even in your financial matters. If DH and I didn't work together with our finances, I'm sure things wouldn't run as smoothly. I also am in charge of the $ around here, but we were together to follow our budget. Good luck.
Thanks for your input and suggestions, everyone. To answer a few questions, my "authority" as the bill-payer doesn't extend to authorizing his work to deposit his check. It's not fishy, he just hands his check to me on payday and I take it to the bank. There's no extra money that he's keeping from me in cash when he gets paid. He thinks we're more aware of how much money we can spend when we have it in cash. I think we're more likely to spend any money we have on hand so we're on opposite sides of the fence on this issue.
Reds, while my examples listed were all child related, they aren't always. We had a tire blow out of nowhere two weeks ago and had the expense of a tow truck and new tire. Dh's work changed what he's expected to wear so we had to buy all new shirts, pants and shoes for him during that time. None of the birthday parties were family that we could plan for. My dks were invited by friends to each of these. It just seems like there are always unexpected things that throw a monkey wrench into our plans when we've tried so hard to come up with a workable budget.
I think it would be much easier for me to budget if we were paid once a month but dh is paid once every two weeks and I'm paid on the 1st and 15th and neither of us is salaried, although I can predict them within $50. So we end up getting random amounts of money all month long, rather than a big lump so pass out for bills and the knowlege that the rest has to last until the next month. I know that online banking is available through our bank so I need to get that set up. I didn't realize that it would eliminate the need for receipts in order to keep track of my dh's expenses. I did mention direct deposit to my dh again this morning and I think he's going to fill out the paperwork. He washed his last paycheck and we had to have it re-issued so that may have been the push he needed. *EG* I really wish that one of us was more comfortable taking the lead with our finances.
Nancy and Crystal, I may take you up on that advice by email. Thanks!
I know what you mean about it being harder to budget when your pay isn't regular. My dh is on commission and that is very hard. It would be better if his base pay were more. It is now at his new job so I hope things improve. I can budget when we have the money coming in .
Only thing I can add...I would really try to start a savings account, that way if you have unexpected expenses, you have some extra $$. Even if you budget just $20.00 a paycheck to put into savings, it will add up quickly. Then, you just leave it alone, and only use it for emergencies. Each year I take part of our tax return and replenish our savings if we have had to withdraw from it.
I firmly believe in online banking, and using a debit card, that way you can track your expenses. You will know after a few months what you are spending your money on. If you use cash, it is hard to keep track. I know my dh always uses his debit card. He stopped taking his lunch for awhile, and he was shocked at how much he spent for lunch in one week. It was easy to see when we looked at our accout. So, now he just goes out for lunch once a week. It was a real eye opener. This is just one example of how it can really help you. I think if you can track what you spend for a couple of months, it will be easier to do a budget.
Also, my dh gets paid twice a month(on the 5th and 20th). I set up our mortgage to pay twice a month. They withdraw 1/2 our mortgage on the 6th, and the other half on the 21st. It helps budget for the two week period. Also, if you do this, you pay off your mortgage early.
I don't know that you need to have dh's paycheck automatically deposited, though certainly I prefer it - as long as it gets deposited intact. Is he cashing it and depositing only part of it? That would give me some concern.
On line banking will certainly help you keep track of all debit card purchases.
I get paid every two weeks, but my bills are due mostly at the end/beginning of the month, so one paycheck generally sits until I pay my bills. I suspect that many of your bills also come due at much the same time.
One of the keys to budgeting is to know how much you are spending. I use Quicken, and I know you can use the category function to categorize almost all of your spending - rent/mortgage, utilities, gas, insurance, groceries, etc, and print out a report for a specific time period by category. You can also set up categories like DH-gas, ME-gas, etc., so you can keep track of individual spending. I use my debit card when buying groceries so I know how much I am spending on groceries, and if I get cash back, I split the transaction so the cash part is listed as Cash. I do the same for almost all of my spending - use my debit card instead of cash.
Keeping track of cash spending is the hardest part when you are working out a budget. It means writing down, each time you spend cash, what you spent and what for. From what you say about dh, that doesn't seem likely, but if he will use the debit card for gas, Wawa (or 7-11 or whatever) and the like, instead of cash, that will help. Once you have a reasonable handle on how much you are spending on what, you can budget more successfully. If you know that you spend, for example, $150 a week on groceries, you can make sure you allow for that when you are making decisions on what else to spend money on in that time period.
Once you have a good idea of where you are spending money, you and dh can talk about whether you should cut back on some expenditures and where. It has to be a joint decision because you are both grownups, and you really can't either put the other on an "allowance" - though you should agree on a dollar figure each of you has in pocket money ... that money for coffee, impulse stuff, etc., that doesn't require a joint decision before spending.
Yes, it is harder to budget when your income varies, but from what you say, it doesn't vary that much. If it were me, I'd figure out the high and low averages, and use the lower figure when working out a monthly budget. If your income in that month is higher, then you will have some money left over and that is the time to save it.
I will again recommend INGdirect.com. ING requires only $25 to open a savings account. Right now they are paying a bit over 4% interest, and there are no monthly fees. You link your ING account to your checking account, and the only transactions you can do are electronic transfers between your ING account and your savings account. If you open an ING account, you should start trying to put at least $10 out of each paycheck into it each and every payday. You will be surprised at how quickly that adds up, and the interest is nice. If you use the lower average figure to work out your monthly budget and your paychecks are higher, put that "extra" money into ING and let it earn interest until you need it. Because the electronic transfer (which you can do by phone or on the internet) takes 2 business days usually, you are not likely to use your savings for impulse purchases, but if you know something big is coming up you can transfer the money to your checking account a couple of days before you need it.
My dad used to preach "pay yourself first" (in other words, put some money in savings every payday) all my life, but it wasn't until about 10 years ago that I really took it seriously. I am amazed at how much money I have been able to put into savings by just paying myself first, starting with $10 each paycheck and gradually increasing it, and putting in "extra" money, like tax refunds, money gifts, my year end bonus, etc. It is a nice feeling to have that cushion for emergencies.
Anon - I read your first post as your DH takes his check and cashes it and then uses it for your expenses from there or that you never see much of it. Sorry I misread that part!
Ditto Ginny and Debbie! My banker sister recently recommended what Debbie is doing with her mortgage to pay off more quickly. We refinanced about 4 years ago and went down to a 15 year mortgage, so that was a huge interest cut. I can't believe how much we've knocked off of our principal in four years! In our next house we're going to do the 2-payments/month deal.
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