Tag Archives: budget

Works for Me Wednesday: His and Hers Money

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One of my coworkers likes to say that her best marriage advice is to buy yourself lots of stuff before the wedding, because once you’re hitched, it’ll be a lot more difficult to justify buying things for your own pleasure. She’s mostly sharing it tongue-in-cheek, of course, but she has a point, especially now that she’s added kids into the mix. Husbands don’t get giddy over a new pair of shoes or the perfect dress on clearance. They don’t wear makeup and don’t understand how a haircut can cost $50. On the flip side, wives often don’t understand the male’s need for gadgets and expensive craft beers. (These are total stereotypes, and I actually like good beer myself, but I think you catch my drift.)

More seriously, though, money is statistically a huge bone of contention in many marriages. In fact, a recent study found that, “Couples who reported disagreeing about finance once a week were over 30 percent more likely to get divorced than couples who reported disagreeing about finances a few times a month.”

Take that with as large a grain of salt as you’d like (after all, I found it via just a quick Google search), but I’d say it’s still a pause-worthy statement to consider. Andy and I have tiffs just like every other couple, but thankfully, money is one thing we’ve managed to mostly avoid fights about. I think a big part of that is having his and hers categories included in our monthly budget. This money is not kept in separate accounts; I’m not setting aside my own pennies “just in case I need to get out.” It’s all still in our joint account. But it’s a line-item in our budget that we’re each able to spend at will without consulting the other.

As an example, here are some of the things I spent my hers money on last month:

  • A cup of coffee at the new Dunkin Donuts that opened on my way to work
  • A latte and a muffin at a new coffee shop that opened in our neighborhood
  • A movie and Chinese takeout while Andy was out of town
  • A dress and a necklace on clearance at Kohls
  • Lunch at Einstein Brothers’ Bagels while out thrifting one Saturday

etc, etc, etc. This month, I’ve spent hers money on a haircut, a pair of shoes at the thrift store, and some new makeup. As you can tell from the list, grabbing a cup of coffee on my way to work or lunch while out on the town is one of my favorite not-so-guilty pleasures. And I’d say it’s not-so-guilty because I know I have the money to spend! Andy doesn’t have to nitpick me about spending a few dollars on coffee, because it’s my money. And conversely, I don’t have to nitpick or even know if he buys a new computer-related toy, a new app, or a book for his iPad. By budgeting some money for each of us, we free our money conversations up to focus on things that matter to us as a couple. When it comes to spending on household items, gifts for friends and family, vacations, groceries, and numerous other categories, we make the decisions together, and that’s important. But I’d say it’s equally important that we have our fun money. I can be as frugal or as extravagant as I want to be for myself, as long as it fits within the bounds of that money. And what I don’t spend in a given month carries over to the next, so what I save builds up, allowing me to plan ahead for gifts for Andy or larger purchases I want to make.

The amount of money we budget each month for ourselves has varied over time. If you’re just starting with a budget, maybe it’s really small: enough to buy a snack from the vending machine at work or a new bottle of nail polish. Or if you’re totally set and have lots of money to spare, maybe it’s more along the lines of a new laptop or TV. Either way, think about including a little bit of discretionary money for each of you in your monthly budget. It works for me.

I’m linking up to Works for Me Wednesday at WeAreThatFamily.com!
works for me wednesday at we are that family

The Envelope, Please

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Y’all have heard my thoughts on the Dave Ramsey cash only school of thought, but as I continue to be exposed to advocates of that lifestyle, my thoughts continue to evolve. And I’ve realized something else about using only cash that makes me nervous.

Andy and I keep very close tabs on our finances. We use a program called YNAB (an acronym of You Need a Budget) to keep track of our budget, our savings, our goals, and our spending categories. YNAB is a sort of grassroots budgeting software that grew out of one man’s budget spreadsheet that he built for him and his wife. As it kept getting more and more complex, he realized how useful a tool this software could be. It’s not the simplest program around, but it has a lot of features that we’ve found to be very useful. Plus, I like its backstory!

ANYWAY, all that to say, we literally know where every penny goes because “Andy Cash” and “Laura Cash” are accounts in our budget just like “Visa” and “Bank Account” are. So if I spend $3.00 at the coffee shop, I record it as being spent out of “Laura Cash.” And I have learned that I’m notoriously bad with cash! It seems like a lot of times cashiers don’t automatically hand over a receipt when you spend cash as they do when you use a credit card and have to sign something, so unless I’m diligent about asking for one (or writing my purchase down on a napkin immediately before I forget…yep, I’ve done it!), the expenditure might slip my mind. AND THEN, I’ll come to find that YNAB says “Laura Cash” should have $22.00 when in reality I have $0 in my wallet. NO BUENO. (For the record, it’s never been that far off. But just about every month when we reconcile, I am off. And then I have to dredge my memory about where that $8.91 could have possibly gone. We often end up having to just write the small differences off, and it’s frustrating.)

If I used the cash envelope system, EVERY SINGLE PURCHASE I MADE would be with cash, and I would run into this no receipt problem much more often! I think that part of the point of using the envelopes is that you simply spend the amount in there and don’t worry about where it goes…but we like to worry about where it goes. Worrying about where our money goes is what allowed Andy the freedom to quit his job in Huntsville without knowing he had one to take its place. We were able to precisely track our expenditures for the previous 6 months and extrapolate precisely what we needed to live on for the next 6. We also were able to pinpoint areas of spending that could be cut if necessary. If we only knew vague spending categories, we would not have felt nearly as comfortable taking that leap as we did.

So I once again find myself at odds with Dave Ramsey’s cash-only suggestion. I personally feel far less responsible with cash than I do with cards, because it has a tendency to slip through my little fingers, never to be remembered again.

How do you keep track of your finances? Do you feel more comfortable spending cash or using a card?

P.S. The YNAB link above is our referral link. If you use it to purchase YNAB because I’ve convinced you that it’s awesome, you’ll get a $6 discount from that link.

P.P.S. As far as my cashflow problem goes, having the YNAB app on my iPhone has helped a lot. When I don’t get a receipt, I can record the purchase in there and it syncs to our budget file in Dropbox via the cloud. Whew! That’s a lotta technology!