annieology

We have, what we like to call around here, budget meetings. In the beginning of getting on a budget, we had them more regularly. Now, only when necessary. The term “emergency budget meeting” strikes fear in the hearts of all.

I am the money nerd. I remember things like the fact that we pay for electricity and such. Hubby is capable of doing it, but I use it as bank so he does things like extract dead possum from between fence slats and such. I could do it, but I REALLY don’t want to.

My role, before the budget meeting is to figure out how much money we have. What bills need paid. Plan for any future expenditures. Providing we have enough money to cover everything that needs paid, I have the authority outside of the budget meeting to do so. In the past, if we got to a point where we had more bills than money then we needed to sit down for a chit chat.

There are two possible scenarios for each paycheck. We either have enough money or we don’t.

In the event that there is not enough money to cover everything that needs paid, we discuss the priority of what gets paid and what waits. We follow Dave Ramsey and his suggestion was food, utilities, housing, car. Which is the order we do things. Many times things can be delayed. It helps to make that decision with your spouse.

In the event that there is money left over, I take that money out of the bank and bring it to the budget meeting in cash. We use envelopes ala Dave Ramsey and have categories for everything that is not a bill. Inside, outside, car maintenance, clothing, pizza and eating out.  We also get blow money.  I don’t have to justify a manicure, he can buy all the frisbees he wants.  We put $20 in each envelope then decide how we want to split the rest.  Say we have $100 left over, it’s all in $20’s because I get it out of the cash machine, we would each get $40 and put the other $20 in one of the envelopes.  Of course the number varies from paycheck to paycheck, but you’d be surprised how much $20/paycheck becomes in a very short time.  Also, if the car envelope is bursting, we’d hold off.  It’s really just a judgement call, the important thing is that you both decide what to do with the money.

The envelopes are great.  We know immediately if we have enough money to accept a dinner invite out.  If  we need an oil change, there is money there.  The goal of the envelopes is to have enough money to cover what we need, and so we don’t have to have daily budget meetings.  Hubby doesn’t like having to ask if he can buy a weed eater.  I don’t like having to ask if I can buy a toy bin.  On the front of each envelope we have a list of budget meeting approved items.  For instance, the car envelope has things like oil changes, tires, wiper fluid, car washes.  It doesn’t really matter what is on the envelope, rather that it was a mutual decision.

We’ve also gotten to the point where we pay the bills two weeks before they are due. Our house payment is due on the first, we pay it on the 15th of the month before.  That way, if we ever became in dire need, we would have a month to come up with it as it’s not past due until the 16th of the month it’s due.  This hasn’t happened.  But we do swap around the daycare payment as needed.

We got ahead slowly, I had to allow for some savings so that I could get there.  I started with the little bills like water, sewer and garbage.  It runs anywhere from $80-$110.  When I got the savings up to $90 I had enough to pay the bill when it came in, getting me two weeks ahead.  I then used the $90 that would have gone to the utilities on the next check, and put it towards the cable bill.  It’s kind of a snowball effect.  But my goal was to get ahead on everything giving us a little bit of a buffer.

As silly as it may seem to say, this is not about the numbers.  It is about getting on the same financial page as your spouse.  If you go all Dave Ramsey on them when they aren’t buying it, they don’t resent him, they resent you.  It took us YEARS to do it the way Dave says.  We both were willing to lose some battles for the sake of the war.

Dave is going to kick us out of his club, but we bought a BRAND NEW car three years ago.  Our luck with used cars was quite awful.  I had a van that would die randomly.  What happens when your car dies, you lose the braking and steering.  Not fun when you have six kids.  I was also having to drive 3.5 hours to visit Mama a couple times a month.  In south Texas.  Through drug running country.  Hubby did not want me losing power and not being able to get it back.  So, we bought a new car.  We were able to pay enough down to not be upside down on it ever, but it goes against what Dave preaches.   If we stick to what we are paying now, we will have it paid off before the end of the year.  We do come into extra money from time to time, and we are both committed to adding what we find to the car.  I’m figuring we’ll be done before summer is.

In full disclosure, hubby has a credit card in his name.  We use it for online purchases.  We have had our bank card number stolen on at least two occassions.  We don’t buy the line that the bank is required to take care of it.  I had used our bank card at a local shop several times over the course of the year.  When the shop reconciled their books for the year, it ran all of the credit/debit transactions again.  They debited our account for several hundred dollars…we were on vacation.  We called the bank, they said “not our problem”.  Luckily they put the money back into our account before any checks bounced.  That would have been a nightmare, and the reason we use credit or cash.  We do pay off the credit card each month, and I do not have one in my name.

The reason I don’t have a credit card in my name, is not that my man is keeping me down.  I know my limits.  I am tempted with credit.  It would be the equivilent to a drunk keeping a beer in the house.  With it being in his name, I feel compelled to discuss transactions with him.  Keeping me honest, and not making him worry that a $10,000 surprise is going to come and bite him in the ass someday.

We have been very blessed financially.  I believe it is because we are very cognizant of what we are doing with it.  We don’t need it.  We don’t need it to the point that we turned down a $20,000 bonus recently. I’m not saying that it wouldn’t have been nice, it just felt wrong to take it.  Because we have been working hard on our finances the past several years, we didn’t need it, we did not have to become enslaved to a corporation for an after tax/tithe realization of less than $1,000 month.

After the car is paid for, my next goal is to live on half of our income and pay the house off in less than three years.  I’m currently working towards that.  I wish you all the best of luck.  Like I said, it’s not about the numbers, a fourth grader can work the numbers.  It’s working with your spouse and hating debt.

This entry was posted on Monday, March 30th, 2009 at 6:00 am and is filed under annieology. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.