Because of all the differences in each household I cannot even begin to write one post that will help everyone's budget issues. I am no financial expert, but I did take finance courses in College and still retain much of the finance common sense rules. I research and read a lot and I search for many answers to any one question so I may piece together what works best for my household. How I am to talk Budget will need to be broken into a few segments and each post will give 2 scenarios: One for those couples who put all money into one pot and scenario 2 for those that separate accounts, but both contribute to common bills. These are the 2 most common scenarios I see and I only sum up what I have researched and have known to work for me. Please do not take me as a financial expert....just some knowledge and common sense tips.
Let's Start With Some Common Sense & Basics
*For Those Who Share Money and Bills in one account
- The List! The list has all money that comes in and all money that goes out. The List has Columns and Rows. Each Row is each payee you owe to each month. The Columns are Paydays or money as it comes in at a given time each Month
- You included Paying Yourself in the Row of Payees, right? IF NOT SHAME ON YOU! You'll learn!
- Be Realistic! Do you smoke? ..still?... really? OK, if you must continue that money hungry habit, then you LIST it! It is money that must go out in repetition throughout the month.
- Spend less than you make...that there is just some Common Sense!
- Stick with it...it is true that when you start saving it is an addiction that gives you a feeling you never want to be without again! It will become a habit and the day you need it and it is there for you is an awesome feeling!
*For Those Who Separate Accounts
- I would read all of the above, but each of you BOTH make a list. It will be identical in regards to Payees you both share and different in only your name/pay dates are at the top and some payees may differ if you solely pay into debt on your own.
- REMEMBER: Finances are not "We have separate accounts, but we share 50/50 in some bills together". No way that is so unfair and will only cause stress to the both of you! Here is where some basic Suze Orman math comes in....
You make $7000 a month
Spouse makes $3000 a month
$10,000 coming into the Household Monthly
- $3000 assumed SHARED expenses total a month (outgoing together)
$3,000 shared amount is 30% of your $10,000 combined earnings. Keep that 30% in mind....
You would pay $2,100 towards those shared Bills (30% of your income)
Souse would pay $900 towards those shared Bills (30% of his/hers income)
$3000 your monthly shared outgoing amount!
So now once you decide who is the most responsible for obtaining both your money and paying the Payee: you would take the others portion, add it to an account and pay those bills! This takes work and you need to do the Math so you EACH know your budget after shared bills. To make the one with lesser income still pay 50% of the total will only leave them more strapped and then they need money from you, they now owe you, they forever are strapped & can't pay you back and you argue! Make sense?
Homework: Make that list. Tally your totals. Play around with it so each 'paycheck in' takes care of bills before the due date and leaves money to live off of till the next payday for you or your other half! It takes playing around with which is why I start w/ Pencil and Paper...below is a snapshot of my list from this month as an example before I plugged in my totals, then is the scribble after marking how each Payee is paid. I am not ashamed to share....
Remember (and this is not my quote)
A Budget is Telling Your money Where To Go Instead of Wondering Where It Goes!
Stay tuned for :
A second look at your Completed List
Your Savings Account