Financial overhaul-help!!!

Yeah to the above- also cut out extras like netflix. Get a library card and do all your entertainment for free. MEAL PLAN. this has shaved 250 bucks off our budget, I could cut more if I wanted to. It is a good idea to have a few vegetarian menus a week as meat is spendy.
Write where every little thing goes on a list so you have a visual, that will help to see what can be cut. Cut extra trips out and about- gas adds up quick.
Cloth diaper if you dont already- savings are huge.
One book that helped me (although a lot didnt apply to my life) was Young Faboulus and Broke. I cant remember the her name but she is a huge financial planner.
Dont use your credit cards- the amount you pay in interest is nasty.
If you have more than one car and can do with one get rid of one. It is a minor adjustment that really saves big.
Shop second hand stores for items that you need. If you need/want something think about it for a few days before buying, most times you will realize you dont need it.
Never go grocery shopping hungry. lol it really makes a difference. Shop only the perimeter of the store, make your food from scratch. (ex pizza costs me 2.30 cents for a large loaded. At my local pizza store it costs 18.00)

I was pregnant with my second when we had some MAJOR financial issues happen. We had already declared bankruptcy two years ago so that wasnt an option at all. We learned to live on much much less, eat better, and spend time together as a family. Things are still tight now but we manage on half of what we did 2 years ago. We still live below poverty but we have a nice house, food to eat, and all the other nessecities.
I have more ideas but no time. PM me if you need any help.

. . . Young Fabulous and Broke. Borrow it from your local Library. I loved this book. Also, www.Flylady.net has great tips on what she calls FACE (Financial Awareness continuously enriches)

Also the Dollar Stretcher has TONS of great articles.

As for who does what: I balance the checkbook, but DH keeps a running total. I write most of the checks, but he does help writing 1 or 2. I do the grocery shopping, he does most of the cooking, though I do love to cook, I love to grocery shop, compare prices, etc. We really do this together. DH would balance the checkbook, if I didn't, he has the skills. Any major expenses we check with each other for permission.

I use Quicken for my checking account register, and also record my spending with it, but I think software is not really necessary, I just have bad handwriting. TEEHEE

Lately I've found it helpful to list my expenses on 1 sheet. The sheet lists due dates and amounts, and I can see everything on 1 sheet. I know which check I'll be using to pay which bills.

For some bills, I pay ahead becauce the check that I use for expenses comes after the 10th, and my student loan payment is due on the 10th, so in order to pay it on time, I have to pay it ahead. I might be able to change my due date, not sure. I get paid every 2 weeks, and 1 check goes to rent, 1 check to everything else, so I record due dates, and pay or schedule payments, almost all online 2 or 3 days before, but I don't have automatic payment, for fear of bouncing. . . .

There are a few rules that I know:

1) Pay all bills on time
2) Open all bills, and record due dates. Put all bills in 1 place
3) Always balance your checkbook, those bank fees co$t
4) Don't use other banks ATMs, always use your bank's ATMs. If your bank doesn't have a nearby ATM, change your bank

I do the money in our house, too.

We use Money, and it has a setup to automatically download from the bank (this is free from our bank; some probably charge) all of our debits every day. Dh travels for work, so this is a much, much easier way for me to keep track of receipts.

We make up a budget together, usually at the beginning of the year. If we get a raise or expenses drastically change, we'll rework the budget. Then, we just really stick to it. We get a weekly "allowance" of cash that keeps our spending under control. Dh pays for our Friday night eating-out out of his allowance as well. In the last budget rework, I put in a monthly CD for dh, which is keeping him very, very happy, and very, very on track with our budget. (It's the little things! LOL)

I pay most of our bills with online bill pay (another freebie from our bank). The only checks I write are the monthly mortgage (need to put that one on bill-pay, too) and our weekly checks to church. We use the debit card for stuff like groceries, etc.

I stopped doing online bill pay because I would forget to write the payments down in the checkbook register. It got messy - several bounced checks.

We keep the checkbook balanced. Additionally, we set a budget for categories (food, water bill, clothes, etc.) and log and reconcile those monthly. We're only 2 months into that, but it's helpful to see where the money is going. Food and insurance are our surprising categories.

I've had a big improvement from just staying out of stores as much as possible. Target and thrift stores are my weakness - I never walk out emptyhanded or just with what I intended to get.

Dave Ramsey is a good one to read. Your Money or Your Life might be a good one for you. Of course the TIghtwad Gazette is a favorite of many people. There are a lot of sites on the internet, from hillbillyhousewife.com to The Dollar Stretcher. The Average Family's Guide to Financial Freedom might be a good read too.

GOOD LUCK!

The first thing I did was write out a list of monthly expenses:
HOUSING:rent/mortgage; each utility
COMMUNICATION: phone; ISP, etc.; postage
TRANSPORTATION: car repair; car insurance; gasoline; registration and inspection
CHARITY: church tithing; charity giving
HOUSEHOLD CASH: food; school lunches; eating out/ movies (entertainment); small household expenses (water filters, paper products, etc.); toiletries/ OTC meds; kid allowances
OTHER: medicines and doctors; clothing; holidays and presents

You have to figure out your own categories, but there are some that are musts. Even if you pay insurance every six months, you take the annual total and divide by 12 months. Even if you don't know what you pay for incidental things like haircuts, everyday household spending, etc., you can make an educated guess.

Then you look at that total. Compare it to your total monthly income. If it covers everything, good for you. If not, you take your income, subtract the bills you MUST pay, like rent and utilities, food, transportation, prescriptions and see what's left. Divide that into the other more flexible categories.

How I track it is - that list guides me: I leave the total amount necessary in my checking to write checks for monthly bills: rent, phone, etc. I take cash out for food, allowances, school lunches, gas, incidentals and eating out, and I put 1/4 of the food money in the Week 1-Food envelope, etc. And then the bills that aren't monthly (like car insurance) I put into another checking account (not our savings account) and keep there until I need to pay that bill. (Total annual divided by 12: like $20 for insurance, $40 for clothing, $100 for medical costs, etc.)

I pay by check for all my bills and car repair, etc. so I have a record (the checks have carbons), and I pay cash for everyday items and put the receipts for gas and food back in the envelope of its category. At the end of the month write down what you spent in total on food, clothing, eating out, etc. based on your cash receipts.

What about when you start this plan and don't have enough to pay a medical bill yet? For the non-monthly account (let's just work with two categories): Example- you know you're saving $40 a month for clothing and $100 a month for car repairs, it's been 6 months and you need to pay $800 for a car repair, then you know you're "borrowing" $200 from the $240 you've saved for clothing. But the next month you'll be putting $140 into the account for those things again, you probably won't have another car repair for awhile, so you are paying the clothing category back. If you keep the three things separate: cash for this month, bills money for this month, future bills like insurance, then you can see easily what assets you have at any time. You can see if you spent money on clothing, or a birthday party, or a car repair, instead of wondering where your money is going (because you have the check carbons and a monthly list of money spent in each category). But the good news is: YOU PAID IN FULL AND DIDN'T CHARGE ANYTHING!

That's how I've been tracking our finances for the last 13 years. It's gotten me out of debt ($25,000 credit card - living on them as a single mom) and helped me plan to pay for what we really needed when money was really tight. Sorry this is so long, but it really works.

Rabbithorns--thanks for the details. I have actually done the first part of your suggestion about a thousand times--worked out our set expenses like mortgage, insurance, etc. Basically the way that it works out is that my dh's paycheck is enough to cover all the set stuff (barely) not including child care. Then my paycheck needs to cover all else including childcare, groceries, transportation (not car insurance), etc. And unfortunately, it doesn't not appear to be enough right now. But I haven't been vigilant enough about tracking how much we spend, and I think the envelope system as you describe it would really help me figure out how much more I need to make in order to make ends meet.

How long would you say it took you to get your system figured out so that it was just part of your routine?. And about how much time do you generally spend each month on organizing/recording spending etc.?

Thanks again, Jessi

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My husband does all our bill paying online...and things like the mortgage are scheduled automatically, so they are never late. I don't think we EVER balance the check book!

But here is my 2-cents worth:
1) Add up your CURRENT financial situation. all debts, equity in cars, house, retirement, etc.
2) Look for hobbies or other things that you own and don't need. Sell via Craig'sList. This is part of the "pre-baby " housecleaning. Last year I sold a loom I was not using for $500 or so. Now I am an ex-handweaver. And I don't miss it! Same thing with an aluminum fishing boat, and many other things.
3) When money is tight, cancel the CABLE TV! Personally, I have never had it
4) Don't eat out! Evaluate "discount" grocery stores and meat-free eating to lower costs.

Honestly we just muddled through it ourselves.
1. Structure your bank accounts for 'flow'...
IN money goes into one account
Must go OUT bills are paid from a different account
then our personal spending accounts.

2. We sit down on the first/fifteen paydays and move the money.
3. I set up as much automatic payments of only fixed bills (like cable is always 39 dollars, but not like credit cards where the balance can change)
I set up automatic transfers of the max min payment on the credit cards, so if your card is 5k, and the min % is 3% of the outstanding balance then I send 3% of 5k once a month, then pay the outstanding balance from where I can...
4. Fix as many expenses as possible, we got a primus VOIP home phone so I only spend $40 for service and unlimited longdistance.
5. If you have any debts go talk to the bank ASAP, often consolidating debts even if the rate seems higher is better as it cuts off avenues for more debt

our spending on 'stuff' clothes, appliances, sewing stuff is all done once a month on the middle month paycheque, I keep a list and then only spend one afternoon and go to the places I know I can get the stuff cheaper.

set goals and rewards as its hard to cut without a payoff.
also when you pay your bills (TOGETHER) take a look at your savings account, 401k and pat yourself on the back look we saved $50 bucks this month....sad but sometimes it helps to see the figures

Make it fun, tell dh you want to look at how to have a great dinner for $10, $5... then think of fun things you like to eat to get it down to that... it maybe more weiner and beans nights but then reward yourself with one nice food at home night. Challenge eachother, think about cutting down not always cutting out...sending a man to work with a brown paper bag lunch when the boys want to go for subs that day is going to cost the subs and a left lunch or double lunch eaten... Also don't fall into the trap where you are cutting out haircuts, manicures, magazines whatever you reward yourself with and he doesn't.

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okay call everyone of your fixed expenses and ask how you could save money now, I got $10 off my cable for a whole year by telling the woman we didn't watch enough tv and thought we could do without it....lol

also look at everything as nothing being sacred, do you need two cars, could you move houses? could you extend your mortgage? are you spending too much on one area? how much does the average person spend in groceries, you might be spending way too much....

We bought "Free Money to Pay Your Bills" by Matthew Lesko. Believe it or not, if you follow the directions on HOW to get the money, most will work! We tried a few different things for us, and helped a friend with a few things out of the book, and with some persistance, we got what we wanted.

Also we were recently remodeling our house a little, so we contacted our electric company and they sent a guy out to our house to do an inspection, for free. He then gave us a bunch of info on how to save money each month. We found out the for all the insulation we bought, we could get a partial refund. Also for ever new window we could get a refund. Same thing if we put in a heat pump. There were a bunch of programs out there, that give you money back that we never knew about.

Also, I don't know if this something you and dh would consider, but you could always have your home re-appraised and refinance. The rates have lowered again and its a good time do so if its something you've thought about. We were able to get a pretty good interest rate and get out enough to take care of some stuff like we have been able to put a chunck of that back into the house, pay off some higher interest cc's and other bills we had holding us back and the rest is a cushion. Our payment isn't too bad either.