Mike and I created one last spring and stopped in the summer and just started again in December. Long story short, we spent a ton of money that could have been saved. Living on the budget isn't hard but when our money isn't allocated to a specific thing it is so easy to overspend.
2. Live off the envelope/cash system for the budget
Easy on the envelopes. WTH on the cash system. I have done envelopes and have done it casually for certain things we were saving for since Mike and I have been married. Back then it was just envelopes in our underwear drawer. This past spring I made it more formal with plastic accordion coupon holders. I saw a great tutorial on the web and created envelopes to put in my purse so when I pull the money out of our monthly stash I can keep track of the gas, grocery and miscellaneous money instead of having 3 wads in purse and not knowing which is which.
Cash only. It was hard. I love my debit card so convenient but yet so easy to spend money. Plus I never have to run to the bank. Now I make my monthly visit and split it up and once our money is gone it is gone. Sometimes I have to juggle from different categories but you can't juggle what isn't there. And when we want to purchase something we have to start saving from scratch. My biggest thing this spring is limited online shopping. Paypal just makes it so convenient.
We have an envelope for long term items and short term items. And my nifty binder with all my money makeover worksheets with my budget breakdown on the front.
Envelopes I made this weekend. So cute and very easy to do.
Total Money Makeover babystep 1: Get an emergency fund! Done
Total Money Makeover babystep 2: Get out of debt
I didn't totally commit to the Money Makeover mostly because I just wanted to do it my way. Well I have come full circle and decided my way is going to take forever. I revised our budget and our goal is to get out of debt by the end of this year. The only debt we have is my student and Mike's student loan. I am planning on paying the rest of my mine February 1, 2010 and start working on Mike's. His is $12000. It is going to take a lot of sacrifice, sweat and tears but I want to be able to pay that sucker off.
It was really hard for me to decide this because it means spending what we have saved now and future monies to the student loan instead of a new house. I have been dreaming about getting a new house. Reality is it will be better for Mike and I financially to pay this off so we have no debt and being able to dedicate our money solely to an emergency fund and new house fund.
Looking back I wish I would have known about this before Olivia, when I got married or even before I got married. We have earned a lot of money and spend most of it and feel like we don't have much to show for it. Oh well. Live and learn.
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4 comments:
Way to go Sandy! That is so awesome to get your finacial situation straightened. Blake and I have been doing some money makeover too. It's pretty similar to yours (I also follow Money Saving Mom). We've been talking about getting on an envelope system forever, and we just needed to DO IT. I hope you find success with this!
I'm so impressed! I need to revisit the "Total Money Makeover". We're out of debt, but then we've not worked to get a nice emergency fund. Way to go for you!!!
I LOVE your family picture. You are so beautiful and Olivia and Mike are so cute. Love it!
Sandy you are inspiring. I started listening to Dave Ramsey on the radio and what he says makes sense. I'm planning on getting me and my husband on a total money makeover too. I would love to pay off my student loan sometime in the near future!!!
what a great system. i am just casually thinking about doing it but since reading this i am thinking i need to get serious!
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