Our Budgeting System

 

Our budgeting system really works for our family.  We learned what we learned from Dave Ramsey's Financial Peace University class.  That was the best investment we have EVER made!  I highly recommend that everyone take this class.

 



 

The first step in coming up with a budget is to create a monthly cash flow plan.  You can find a template for this on Dave Ramsey's site.  The idea is that you plan out where every penny of your money goes each month - - it's called a zero-based budget.  When you get to the end of the budget for the month, you should have $0 left over.  That's okay, because you budget in savings.

Figure out what all of your bills for the month total to, using Dave Ramsey's form.  This gives you a great base for your budget.

We use the Allocated Spending Plan each week to move our money around between accounts.  This form was given to us when we took FPU, and it's not available online for free.  What it does is it breaks down all of the items in your monthly cash flow plan, and gives you space to decide when you'll make each payment during the month.  We have it all laid out so that we pay all of our bills on time.

Each week after we get paid, I write out on a separate sheet of paper what money is going in which account.  Then I make our transfers, since all of our paychecks are automatically deposited into the same account.

Hubby's checking is for most of our bills.  Internet, Netflix (which is our replacement for cable), Electric, etc. are automatically withdrawn from his account, so I leave those amounts in his account.

My checking is for any checks that we write.  It's the only account we have a checkbook for.  Out of that account comes tithe, Compassion, student loan payments, and car payments come out of that one.

My savings account is our emergency fund.  His savings is our short-term savings.

Notice the "IOU" in Toiletries - - we borrowed for babysitter, so the next time there is
budgeted money for a babysitter, we will put it in toiletries.

We take out cash for household expenses, which works SO well for us!  It's called the envelope system, and it's wonderful.  Instead of us both using our debit cards to make purchases like groceries, coffee, gas, and other expenses, we have cash set aside for each individual category.  It keeps us on budget.

The categories we budget for in our envelope system are:
Babysitter
Laundry
Gifts
Toiletries
Gas
Groceries
Baby Supplies
Date
Repairs

Happy Budgeting!