spending plan (budget) how to ?

[ccasanova]

Up until now, dh and I have been doing what the opposite of having a budget is. Dh brings home his paycheck we pay the bills and then buy what we need throughout the month. If we know our checking account is getting low we use the credit cards and plan on paying off the balance when we get the statement. (Most of our bills are due in one part of the month so we are tight on that paycheck and have surplus the next paycheck, so that is our reasoning for using the credit cards) Our credit card balances have started to not get paid in full however, and our balances are rising, so I need to and will nip this situation now before it gets worse. I wanted to know what kind of spending plans you follow. I have heard of the envelope method, which sounds good, but want to find a method of budgeting that dh will be willing to go along with. Do you pay the bills first whatever the amount due may be and then budget the rest? Or do you budget even the bills? It's kind of hard to know how much the electic bill will be before it comes, you know? TIA!

[Knittin' in the Shade]

a lot of utilities you can get on a yearly budget plan, wher eyou pay the same amount each month, and then in the 12th month you pay the difference (sometimes it's you paying them, sometimes it's them paying you) That would help a lot in terms of knowing what to budget.

[root*children]

We budget out everything...even bills. The bills are not too hard to budget, because nearly everything is semi-predictable, even electric. Have you been saving your old statements? Just find the average and budget that in every month. We do the envelopes system, because DH actually prefers it. We budgeted before, but it was all in my head, and DH felt like he didn't know where any money was going and it gave way to some serious control issues, etc. Anyhow, now when he cashes his paycheck, he deposits some into our checking account which is the portion for bills.

So, our categories are:

Savings
Bills
Gas (for cars)
Kayaking gear (DH's obsession )
Food
Trips
Classes (this is for anything "extracurricular")
== then any money left over we split up and that's our extra "free" money for the week.

[Leta]

For our "unreliable" bills (gas, electric, water), we estimate very high, $300 per month. This month, our gas bill was really low ($36), our electric was really high ($89) and our water was about average ($60). So our total was $186, leaving $114 left over from our budget, which now goes into our savings. Does that make sense, or did I make it sound too complicated?

Also, you can move the dates of your bills around, just contact the company. We have a biweekly mortgage, due every other Friday (DH gets paid on Thursdays) and that is PITI, so we don't have to worry about semiannual tax and insurance lump sum payments; our gas, electric, and water bills are due the first paycheck of the month; phone, Netflix and grocery shopping are due the second paycheck of the month. We have not yet figured out how to budget well for car insurance, since we pay that every 6 months, we have just been taking it from our savings and that needs to stop.

[ccasanova]

thanks so far for your ideas

Leta-

What I would suggest is dividing the amount that you pay every 6 months by 6 and then save that every month in an account so the $ will already be there Even if you do put it in the savings account, you know that your not really dipping into the "savings" because you put that $ in there for that purpose


Root*children-

It sounds like you get paid every two weeks. Do you make your budget every pay check instead of every month, since that is when you get paid? And where you categorized "classes" would that be every misc. thing like personal hygiene stuff, clothes, shoes, and stuff like that? I was thinking that it would be better to not have so many categories like you are doing. If not, there would be a whole bunch of envelopes!

So do you mamas think that the first thing that should be done is figure out our wants for the future? Whether it is to debt free, save for retirement, save for a special vacations, etc? Then see what extras are really important to us, keep those and remove the ones that we don't care that much about? Then budget for the month with the different categories, and stick to it? When the $ gone in a certain category, it's gone! Unless it's an emergency I know Does this sound like a good plan?

[ccasanova]

Leta- Your summer must be really mild! I wish my electric bill was back to $89! This last bill I got was $225 and stayed around there the whole summer! And I'm pretty frugal with the air conditioning too! I keep it at 80 degrees during the day and turn it off at night. But our summers are hot, hot, hot!

[Leta]

Oh, we don't have AC. We live in the frozen north. We have fans.

[SashaBear]

I think you need Dave Ramsey's Financial Peace University. daveramsey.com is his website. Look into taking the class if possible. If not check out a yahoogroup on dave ramsey. They can walk you through it.

[Tradd]

Originally Posted by SashaBear

I think you need Dave Ramsey's Financial Peace University. daveramsey.com is his website. Look into taking the class if possible. If not check out a yahoogroup on dave ramsey. They can walk you through it.

The BEST DR related site (free) is www.livinglikenooneelse.com