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Friday, August 15, 2008

How Do You Stash Your Cash?

How do you stash your cash? I have tried many ways over the years, and have learned some very valuable lesson. In this article we will talk about the best way to handle your money.

The first thing that I learned as a married lady is that one person needs to do the majority, if not all, of the financial things. I have found that when there are too many people involved, things are forgotten and arguments are started. So, the first important step is to decide who will manage the finances.

The second important thing is to create a budget. I can not stress this enough. Not having a budget is like jumping out of a plane with no parachute. A budget is so important because it is a way for you to see how much money is coming in and how much is going out. It can be such a beneficial tool in getting out of debt, and in saving for a big event. It also helps you get things paid on time, because if you refer to it often, you will not forget about certain bills because they are right there on paper. We went without a budget for quite a long time, and it was complete chaos. We had no idea of what was coming in, and where it needed to go. It kind of felt like we were walking in the dark. Since we have implemented a budget, our finances have drastically improved. We now know where everything is going, and how much we will have left over at the end of the month.

The third thing to do is decide which method you will use, there are several. We have tried the joint checking account, the envelope method, and the notebook method. The joint checking account was a big mistake. There were times when things were not recorded. Someone forgot to tell someone about something. Let's just say this was a disaster.

The envelope method works well. This is when you label different envelopes with the bills that you have to pay for the month, for example; rent, car payment, light bill, etc. We have used this method and it works well, however some may not like it because it does require a little effort.

We currently use the "notebook method", that is what I call it. I have a notebook that I keep for my finances. In the notebook I write out a column for each pay period of the month, and the amount that check will be. Then I write underneath the check amount what needs to be paid out of that check. Then when everything is subtracted, I know how much we will have left out of that check, and that will go into savings. I do this for the entire month, and make sure nothing is left out and everything is paid on time. This method has worked wonderfully for us, we have a budget, and this is sort of like a budget check up every month. It helps us make sure we are on track.

The next thing to decide is if you will have a checking account or not. We do not have a checking account. We use the cash method, no checking account, no debit card, and no credit cards. If we do not have the cash, we do not buy it. I love this method, it works so well. It did take a long time for us to try this method. I used to think that we would not be able to survive without a check book, and now I don't see why we ever had one. We do still have a savings account, but no checking. All of our money is deposited into the savings account. At the beginning of the week I withdrawal what we need for the week to pay bills, buy groceries, and buy gas. We simply repeat this process every week. You would not believe how much using this method will simplify your life.

So the recipe for financial success contains the following ingredients: a head financial person, a budget, a method, and a place to keep your money. With all of these things in the mix, you should have no problem becoming financially successful.


Amy @ Thoughts from the Mrs. said...

The hubster and I use the envelope method for our budget. It's the best for us because I tend to over-spend sometimes. Woops! :) With this method, our money is clearly categorized and I'm aware of how much we have for each category. It saves me from "sneaking in" another purchase.
What can I say? I love to shop!

(visiting from MBC and just added you to my google reader)

Ashley said...

I think I may be the exact opposite, because I absolutely abhor cash. I keep a single twenty in my car for emergencies but that's it. Everything else is secure in my checking account. With online banking, I have my bills automatically withdrawn each month and I have my entire month's expenditure right at my finger tips to analyze. There's no forgetting to write things down. Just a detailed list of the location, date, and amount of each transaction.

Everyone is different but I find this much easier to keep track of my finances and less likely for theft.

Brandy said...

Thank you so much for your comments. I always like to hear about what works best for others. Thanks.

Tina said...

I hear everything your saying and my husband is always trying to get me to make a budget.There are a few questions I have though.How do you make a budget when you don't know what your weekly income is my husband is a truck driver and no 2 pay checks are the same ever.Also since the grocery,electric and gas bill(winter)are never the same how do you work them in.If you can answer these questions I am willing to listen you can contact me at