Amazing Money Management Tips
July 27, 2007
If you came here looking for some amazing money management tips - you came to the wrong place. Rather, I need some tips from all you wise readers of this blog. Prior to getting married, Sarah and I had very different ways of managing our finances: Sarah managed hers and I didn’t. So now we’re trying to figure out how to do this together, and as you can imagine, we’re having a lot of fun with that.
Or…not.
Since being married, we’ve tried a few different ways of handling the money. At first, Sarah just let me look after it and make sure we were doing okay. But, that didn’t work. And we both knew we each needed to be taking part in the discussion and care of our finances, so we switched to our current method, more-or-less described below:
- We spend money, and we keep all of our receipts.
- Every week (more like every other week, or if it’s really bad, every three weeks) we sit down and I read through each receipt, while Sarah manually inputs them into Quicken, categorizing them according to the budget we created.
- Then I get online and check the online bank statement to make sure we caught all of the online bills, purchases, deposits, etc.
- More often than not, the online balance and our Quicken balance are different (tonight there was a $350 difference).
- Then, if we haven’t gotten frustrated enough already, we’ll check the budget to see how badly we’ve gone over the budget.
This process is frustrating. I’d prefer to not have to manually input all of the receipts. But we need a way of knowing where our money is going (and it does find places to go, doesn’t it?). And the fact that the balances are often different is frustrating as well. But we really don’t know of any other good systems. Do we just sign up for the $4.99/month Quicken service where it automatically downloads all of our transactions into Quicken - but then we still have to go through each one and add the correct category. More often than not, now, we don’t actually look at the budget in the end (we also haven’t adjusted our budget since having moved to Princeton), and I wonder what the point of any of it is. Sometimes, I’d rather just check online to see if we had enough cash in the checking account, and if we did - then we’re good to go.
So, what do we do? What do you all do? Those of you who are married - what have you found works well for you? Any systems that work well? Any tips? Any money programs (for Mac), other than Quicken, that you’ve found helpful? Any Excel users out there?
[In case you missed it, this is the point in the post where you begin to dispense amazing money management tips to the Walker Cleavelands and all other readers of this blog]
Tags: Bills, Budgeting, Budgets, Finances, Money, Money-Management, Suze-Orman
Posted in General
Adam Walker Cleaveland: I am a 28 yr old 
July 27th, 2007 at 1:19 am
i had the opportunity to take a class at my church this summer called ‘financial peace university’ and i was surprised at how good it was. it was especially geared to married people. i would recommend it if you can find a class in the princeton area.
July 27th, 2007 at 1:24 am
I don’t feel that comfortable typing this out on your blog, but if you give me a ring some time tomorrow I’ll be happy to talk with you about what Jamie and I do. Maybe it could be of some help. If you don’t call, though, I hope you figure this out. It’s tough.
kp
July 27th, 2007 at 7:16 am
Having a budget is great, so you are moving in the right direction. It sounds like sticking to it is the problem. Your Quicken habit sounds good, but perhaps too complicated once you introduce the online side. I would suggest that you forget about the ’sit down once a week and enter purchases’ thing and just enter them as you make them (online or otherwise).
It is a great help to be able to see how much you are spending on what. The key is getting that information in front of you. After that, it is just self-control.
Maybe Kellen has better advice. :-)
July 27th, 2007 at 9:37 am
FPU is a worth while class, I have a dave ramsey book i’ll send you if you are interested. I think the biggest thing is having a budget and sticking to it. The bank will always post things at a different time than your reciept says.
For me quicken got to messy, I just made and excell spread sheet.
I keep every reciept. At the beginning of the month I look on the Wachovia site, i put every reciept that shows up on the bank account in excell. This always leaves me with some reciepts in a pile. I add those up on scratch paper so I know where we are on “out to eat money” or “entertainment” or what have you. And we just stop eating out, grocery shopping or whatever when they get empty. I think we have probably one more meal this month we can afford to eat out. It seems to be working for us.
But spreadsheets are where its at. Then you can plug in exactly what is in your bank account and just subtract from that. The sync features in quicken f-ed me up for the first months of our marriage.
July 27th, 2007 at 9:43 am
ummm…. i’m a financial imbecile… my wife does it all…
one of the things that we’ve done with our budget is giving each other “allowances” and also a category called “blow money”. each week i get $20 to do whatever i want with. i save it, use it for food, movies, etc. this is money that we don’t have to track, that i don’t have to have receipts for, etc.
the “blow money” is a cushion account that we have about $100/month in that if we go over in a budgeted area, we shift that money over to cover it… and if we don’t use our blow money we add it to our savings with the rest of the money that we save per month.
all of our banking is done online, and with paper. it’s easier and faster than adding it all into quicken (the most complicated program ever). we don’t go through our receipts, we save the appropriate ones in a file for tax time, and instead use the online “checkbook register” to check against our budget…
hope this helps. it’s worked really well for us and has decreased our debt considerably. i’d also echo the thoughts about dave ramsey’s financial peace university. if you can find one nearby, have a go at it!
July 27th, 2007 at 9:47 am
You have to go “Old School”
mel and I have been married three years. We tried different systems like everyone else who has posted. How things are now.
1. I suck at math and money. My wife keeps track of finances
2. Debit and credit cards are what kill you. You have to create a budget. Deposit your money and withdraw in CASH what you need for your budget. Put it in different envelopes. For example you have a “gas” envelope in your car. Entertainment, grocieries, rent, etc. envelopes in your house. You and your wife get a “fun” money envelope. You spend what you have and if you run out of money then you either need to fix your budget or not go out to the movies. Basically its like giving your self an allowance and if you dont have cash in your pocket you skip lunch or that expensive beer. You basically lock up you debit card and keep your credit card around for emergencies. Its not perfect but it works ok for us.
July 27th, 2007 at 11:08 am
I’ve never done the joint management thing, but I have done the quicken thing. I have 2 suggestions:
1. Check out Wesabe (http://www.wesabe.com). You just upload the quicken/money files downloadable from your bank, and then it helps you categorize things. This is good for seeing how you are doing on your budget.
2. Quicken has a feature that allows you to reconcile your account with your monthly bank statements. You should just reconcile once a month instead of every week, its less frustrating that way.
Good luck
July 27th, 2007 at 11:13 am
My wife comes from a family that would make Ebenezer Scrooge prior to his encounter with the ghosts of Christmas past, present, and future look like an out-of-control Hollywood star on the verge of a crash. My family, on the other hand, was of the mentality that if you wanted it and could get it (whether by cash, credit, or otherwise), go for it and figure it out later.
Let’s just say it makes for an interesting marriage.
Anyway, some things we have learned from each other:
1. Figure out how much you bring in each month. If you’re paid semi-monthly or monthly, that’s easy. If you’re paid by the hour, I’d base your monthly income on four weeks’ typical earnings (four times per year you’ll get a fifth check in a month, which you can just think of as extra to save or splurge as you see fit). And go with net here, that’s your income after taxes.
2. Figure out how much you have to pay out per month in regular bills (rent, car payment and routine maintenance, phone, insurance, utilities, etc.). These are fixed expenses, so you can’t really fudge on this step.
3. Take the difference between the two, and you have your discretionary income, what you can spend on the things you have control over, like gas for your car, food (both groceries and eating out), entertainment, charitable donations, and blow money.
4. You and your wife will need to figure out how to spend the discretionary income together. And you may need to cut back on some fixed expenses - we sold one of our cars - keeping the older one that was paid off, didn’t have cable for several years, used internet at school rather than having broadband at home, etc. We have found that we can eat quite well on $50 per week - we were doing $35/week until we decided we needed to eat healthier.
5. I echo Morts from above - whatever you do, find some way to give you and your wife some money that is just yours. My wife and I get a set amount each month that we can do whatever we want with - buy a CD, see a movie, save for an iPhone, whatever without consulting the other. Everything else we spend money on - and I do mean EVERYTHING else - must be agreed on between the two of us before we spend it. That gives us some fun while helping us to keep things under control.
Once you know where you intend to spend your money and how much, you’ll need to figure out what works for you to stick with it. For us, what works is using cash for food and fun money and a credit card we pay off every month for pretty much everything else. If there is an area where you really tend to splurge a lot, I’d recommend using cash for it. Get all the cash you intend to spend at a specific time each week or month (we do groceries weekly, because we spend it weekly, and fun money monthly).
And one other piece of advice, when you see something in a store you want, take note of it (mentally or literally), then go home. (Or walk away from the computer if you’re shopping online.) Talk it over with your wife. If it is important enough for you to go back and get it the next day (don’t go back the same day unless it’s a medical emergency), then figure out together where the money is going to come from.
I guess my gist is to plan where you are going to spend your money ahead of time, including a set amount that you can do whatever you want with - the key is deciding that amount first, then spending it.
Hope this helps.
July 27th, 2007 at 11:16 am
If Sarah was doing okay managing her money before you got married, why not let her manage your all the money now?
One other idea…
I checkour online bank account every day (or, at least, 5 times a week). If something is off, I know it immediately and can figure out where we went wrong. It doesnt take too many times of being wrong before you start to get it. It literally takes me less than 2 min in the morning. I just look at everything that has posted in the last day, and compare it to the list of what I expect will be clearing this pay period (I do this in excell). I tried using Quicken for budgeting in the past, but didnt really see the point, especially when we were living on next to nothing.
July 27th, 2007 at 11:31 am
Don’t use a Mac (don’t cringe), so I can’t give any suggestions from personal experience for software, but this one looks good. It can import your Quicken data, which is a plus. $17.95, though. You might also check SourceForge.net - most of their stuff is for Linux and ported for Windows, but there is occasionally something on there ready for Mac. Advantage is, it’s OpenSource, and I just find it ironic to spend money on something that’s supposed to help you control your spending.
July 27th, 2007 at 11:49 am
I would think the 4.99 for Quicken’s service would definitely be worthwhile. I’ve used Microsoft Money, which does the same thing and found it very helpful. Not only does it automatically download your transactions, but after you set the category for a purchase from a certain store, it knows to always categorize purchases from that store as the same thing. I.E. once you set all purchases from Old Navy as “clothing,” future purchases from Old Navy won’t need to be manually categorized. So your work is cut down the more you use it.
July 27th, 2007 at 1:20 pm
So, here’s my 2 cents. We’ve been married 28 years and the system seems to keep us in pretty good shape. I do all the finances, hubby is not a money guy. Life is much more calm this way, we don’t drive each other crazy. That is not to say we don’t talk about money, it’s just that we don’t have to talk about the little everyday stuff, only the big purchases or changes to existing bills.
I tried Quicken for a while and HATED it. I use an excel spreadsheet. I use a system similar to Daryl’s, with some modifications.
1. After I have done his steps one and two I put that information into a second page of my workbook. I have it divided by pay period, so that the check on the 15th has bills to be paid deducted from it, and likewise the end of the month check. If I have a bill that is too big for one check (like the house payment) I divide it in half between the two checks. I also keep our two checks in separate columns. In our case my checks pay all the bills and hubby’s checks pay for food and fun. But that way when I enter the check into the check book page I can just copy and paste the bills into it.
2. Hubby puts all receipts into a pre-designated place (we have a cubby in our computer desk) and I collect them a couple times a week and enter them in the spreadsheet, I enter mine whenever I’m working in there. I also deduct charge purchases from my checking account just like they were checks, then when I get the credit card bill at the end of the month I just go through and make sure I have all those charges accounted for.
3. I have just this year started online banking (I was chicken). I love this, especially since my bank gives it to me for free. Since I don’t get a check number for this and to note that things have been paid I just put “Bill Online” in the check number column.
4. Another thing I have done with my spreadsheet is to add some additional columns to my base page. There is the column of the normal monthly stuff. Sometimes we come into some additional money (tax refund, bonuses, etc.). I added a column for each of us so that when this money came in it could be put in a separate column and not just used up in the normal day to day things. We could do special things with it. I also added a column for the tithe on this money - we use that money for when we need to buy Sunday School supplies or stuff like that. I also added a column a couple years ago for a gift pool. That way when Christmas or birthdays roll around we don’t panic and start charging stuff we can’t afford.
All this may sound complicated, but once it is set up it really only takes a few minutes a week. I wish I had had a system (almost any system) when we were first married, we wouldn’t have had the credit disasters we did. Good luck!
July 27th, 2007 at 1:51 pm
Hi! Kellen said to read your post, and I gotta tell you, as the financial keeper in our little family, everyone’s suggestions (and don’t get me wrong, different things work for different people) are a little complicated for me. The bottom line is, if it gets too hard, you won’t do it. Then you are back to square one and feeling like crap. My system (which I made up myself after spending a year living and working on my own, and through trial and error) I do by hand, on one page of a 4 X 6 pad of paper. It’s easy, we have never had a problem of any kind, never missed a bill and we go out and shop and do fun things all the time, without having to stress about where our finances are at. It’s a really simple process I use, so I’d give Kellen a call, or me, and we can give you an easy, quick rundown.
July 27th, 2007 at 1:54 pm
As far as husband and wife talking about how money is spent goes, I think its a waste of time.
I dont mean couples shouldn’t have some conversation about this - and especially about the big things (whatever you define as “big”). But, seriously, who wants to talk about if you should spend $70 or $100 at the grocery store? I know so many couples who would get into money fights over piddly stuff like that. Whats the point?
In our house (married almost 13 years) we agreed on some principles, which we have updated as situations change. And spend money according to those principles.
Make a general agreement about how things should be spent, and then you only need to talk about it when something out of the ordinary happens (a big purchase, an unexpected car repair, etc).
Have 1 person (sounds like it sould be Sarah) be in charge of keeping track of how things are going, and let her do it in whatever way works for her.
July 27th, 2007 at 2:24 pm
Just to clarify - most of the steps I listed above are one-time steps. Once they are done, there is no need to repeat them unless there is a change in the money flow (change in salary, or a change in bill amounts, for example). The setting up part is the hard part, and the maintaining should be easy if it is set up well.
My wife and I spend very little time now talking about money, but that’s because we both know where it’s going already. It’s only when something that comes up that is not accounted for (for example, our income changes, or we decide we want to take a vacation and have to figure out how we’re going to pay for it) that we talk about money any more. For us, it works best to spend our money (theoretically) first before we write one check or buy one thing.
The great deal of concentrated time over about a week that it took for us to set things up (plus some conversations here and there over the next couple of months as we tweaked things) was time well spent in my book. Money simply isn’t a source of stress, and I think that’s the goal of money management. My wife and I are happier together as a result - since we’ve come to an agreement on things, it’s all mostly a non-issue now. But that’s our story.
Like any advice or suggestion, take what you like, throw out what you don’t, and keep working at it until you find what works for you. My wife grew up being told that the only way to buy groceries was a trip once a month, but she has discovered that we better manage our grocery money with a weekly shopping trip. Monthly worked for her mom, but weekly works better for us.
July 27th, 2007 at 2:36 pm
Adam,
I am not a financial sage, but I thought I’d point you to a new web 2.0 app in development called Mint (www.mint.com). It’s in invitation-only beta right now, but I have a feeling it’s going to be an awesome program.
July 28th, 2007 at 12:09 am
my advice: don’t worry about it. if it drives your marriage crazy i would ask: what’s driving your marriage?
July 28th, 2007 at 1:00 am
cleave,
some things i’ve done over the years that have been imported into the marriage.
the weekly allowance idea is something i have been doing for years. put a twenty in your pocket at the beginning of the week. that is all you get…and you have to be disciplined about this. i learned the habit from a friend doing americorps. that was, quite literally, his allowance. not only does it keep you from spending money electronically (leave the cards at home), it also forces you to consider what you really need to buy. want that macchiato? four bucks. or go to wawa and get a cup of coffee for a dollar. once i got into this habit, i was amazed to find that i actually ended my week with five or six dollars. those two dollars here and three dollars there add up (i think some financial guru calls it the latte effect). break that habit and you will carve out some nice breathing room.
get your money into an ING account. it is easy to transfer into your bank account, but there is a lag time of one to two days. when you need that money readily, you have to think ahead (e.g. for the car payment). if you don’t really need it, you have two days to realize as much. just send it back. plus you earn 4.5 percent on your checking balance.
buy wine by the case and store it. over the life of the twelve bottles, you’ll save at least thirty dollars.
eat fruit instead of other things for snacks. much cheaper (esp. bananas) and healthier.
convince someone to let you bounce. easy money there.
most importantly, don’t stress out. seriously. we all know money is a headache, but dealing with it as a necessary part of life and dealing with it as a spectre are two different things. people live on far, far less than we do every day. when money ceases to matter beyond the fixed expenses (see allowance strategy above), you can breathe. the bonus is that you soon find a little more in the bank…which you should invest asap. call me for tips on that one.
drinks on me. soon.
July 28th, 2007 at 10:27 am
DUDE, JUST LIVE OFF CREDIT CARDS, CHARGE EVERYTHING, AND RACK UP MASSIVE DEBT. DECLARE BANKRUPTCY. REPEAT.
IT’S THE AMERICAN WAY.
;-)
July 28th, 2007 at 11:13 am
Total Money Makeover: Dave Ramsey.
Best book ever. My wife and I have been married 24 years. A couple of years ago we got his book and started living by it. It’s made all the difference in the world. We can pay our bills and have enough to pay our sons college, out of our monthly check.
The first thing you do is get rid of the credit cards. Don’t use them. We kept one for an emergency and for trips. But you don’t charge regular stuff on them. There’s something about seeing money in your hand, leaving your hand, that causes you to spend less. Also, Don’t go buy new cars…..save until you can pay for them upfront.
I’m giving away the book. Anyway, it wasn’t that tough. I wish we’d done this when we were your age.
I strongly believe God wants us to get our finances in order for what is to come.
I’m not a doomsday guy but I think the United States is in financial trouble and we can’t keep living this way. If we are truly into freedom in Christ, how can we be serving the master of money and our God at the same time.
Okay, enough preaching….
Get the book and start the adventure to freedom.
You’ll be sooooo glad you did.
July 28th, 2007 at 3:49 pm
Since nobody has said it yet, save at least 10% and tithe now and forever.
July 28th, 2007 at 4:24 pm
Adam & Sarah -
I ditto the “if Sarah did well, let her keep track” AND make a budget,
Use cash/debit, pay yourselves each a personal allowance in CASH and when it’s gone, oh well.
save credit for big things (that you then pay the balance off next month, or in an emergency cuz we all have them, in a couple of months and besides that helps you build a credit history for when you apply for a mortgage, etc).
Save change in a big jar with a small opening, even the occasional bill. Count when full and save 50%, tithe 10%, reward each one of you with a 20% bonus allowance for your good habits! (or figure our your own split) One of those water dispenser jugs is good, or anything of any size that you cannot put your hand down into (or start small and work your way up…or do a piggy bank!)
Do meet weekly or every two weeks to review. My parents did it for years. I did it when married for 18 years. I do it with myself now (boring but oh well!). Then, if God forbid something happens to one of you, the other knows what is going on.
Balance your checkbook/online balance or get it darn close, or do the “round up” method when you enter and you will always have extra pennies around (I cannot do the rounding thing - the “J” in my MBTI and the enneagram 1 clash too much with this….sigh).
WRITE it down in the checkbook or spreadsheet/quicken as you spend - don’t rely on the online record (which helps with the “oops, forgot that scheduled phone payment, savings transfer or similar expense that I didn’t enter” problem).
Save 10%, more if you can and begin investing NOW.
Make wills, do durable healthcare powers of attorney - yes, even now. Be sure your life insurance (term!) is current and has appropriate beneficiary info.
Have renters insurance. Pennies per week. Peace of mind, priceless.
Do I do all these things now? NO but I do many of them all the time, some of them I had to amend thru crises in life (divorce and losing a job among other thing). I didn’t start really investing or saving from retirement adequately until later than I should have. The decade of my 40’s did a number on my finances, and while I did OK in my 20s-30s, I could have done better.
You can do it - you are wise to ask and seek counsel. Who knew you would get so much great advice (and you have some great responses here in this blog!)
July 29th, 2007 at 9:54 pm
To add my two cents. We have been doing the $20 allowance going on three years now and it works out well. Both of us had similar approaches to finances before marriage and have alternated responsibilities depending on who was in school at the time. I think that’s rare. Go with whoever is better at it, in this case it sounds like Sarah, but do talk about it weekly/bi-weekly whatever so that you’re both in the loop.
Budgets are good. Taking stock of spending trends via excel and the rest is helpful too. Keeping track of our money allowed us to actually start a Roth IRA once Peter got a decent job while I finished up at PTS.
We just read “the Money Book for the young fabulous and broke” by Suze Orman which was helpful as we’re still living on one income and one partner in grad school. She takes a slightly different approach from Ramsey based on credit cards.
Also, we got some good pre-marital advice about the psychology/power of money. Think about why you spend or why you save. Is money being spent to fulfill a void, out of stress etc? It was helpful for both of us to talk through our patterns and thresholds of comfort related to debt and the rest. Thinking through wants and needs based on consumerism is tough work, but worth it for your futures as pastors. You’ll be doing stewardship campaigns etc.
Thanks for asking the question! I learned a lot from all the comments. Good luck!
July 30th, 2007 at 3:15 pm
Take a look at NeatReceipts.
The head of customer service is a friend from Camp Johnsonburg. I think I can get an employee discount for you.
Of course, that costs MORE money ….
August 5th, 2007 at 12:27 am
read, Jean Chatzky’s MAKE MONEY NOT EXCUSES book. She will tell you everything you need to know. You can also check out her website at Jeanchatzky.com
August 5th, 2007 at 8:25 pm
this is how we do it.
1. dave takes care of money.
2. money situation goes from bad to worse as over time dave struggles to pay attention.
3. jen takes over the money.
4. money situation goes from bad to worse as over time jen struggles to pay attention.
5. dave and jen freak out.
6. dave and jen do money together.
7. money situation goes from bad to worse as neither dave nor jen have the will or attention span to tend to money.
6. go back to number one, repeat for ten years.
good luck, kitty-cats! save your paypal dollars to send us ramen money for the poor house when we’re old and gray!!!