I am so impressed by the people who came today and shared their stories, ideas and tools. Here is what we talked about today, hopefully you can benefit from reading it. The group meets the 1st Saturday of the month at 11am at Lauber Financial Planning (www.lauberfinancialplanning.com), until further notice.
The group identified that they, as women, usually get the brunt of criticism about spending but, in fact, we are the ones responsible for doing the purchasing of things for our family & home. When the non-spender in the relationship becomes resentful, it’s probably because s/he feels unheard and feels things are out of control because s/he isn’t controlling things. (See my blog post “The Illusion of Control” http://amyjolauber.wordpress.com/2011/03/22/the-illusion-of-control/ )
Tools used to create or maintain a budget must be personally useful; what works for one person may not work for another. Here are some tools we identified:
1. Keeping track mentally (good if you have clarity and a good memory).
2. Saving receipts, reconciling once a month (good if you are organized).
3. Using software like Quicken or Mint.com or even excel spreadsheets (good if you like analytics).
4. The envelope system (either a set amount per day, any excess goes into a “savings” envelope OR set amount per month or week for different categories such as groceries, gas, school related, pet supplies, eating out). This is a good system if you need to set limits or goals for yourself.
5. If you charge everything, some credit cards give you a summary per month or year on what you spent per category.
6. Keeping track on paper (good if you keep it in your wallet/checkbook).
7. Pay with only cash. Studies have shown (and I have proof, because my hubby and I did an all cash budget for a year) that you spend 30% less when you use just cash versus when you use cash and credit or credit alone.
1. too many things in the “miscellaneous” category to track or even budget for (i.e. pet supplies, stamps, cleaning supplies, cough/cold remedies) *Create categories and allocate funds to them to minimize the true miscellaneous.
2. Emotional purchases (gifts) *Look at the root desire
3. Coupons from stores prompting you to come in and buy or “miss out” on the deals. *You are not saving if you are spending.
4. Dining out, especially if you are busy with work, kids, kids’ activities, volunteer work. *Meal planning, crock pot meals, and healthy snacks in the cars ward off this temptation.
5. Target: Everyone said that they have trouble leaving the store without spending a lot more than they had planned when they went in.
A few people said that they budget, but don’t reconcile their spending against the budget, so that became their goal this month.
When asked if anyone served as a role model for budgeting, those of us who did had parents that were depression-era.
We all agreed that our current society has a lot more expenses than previous ones (cell phone, computers, kids’ sports/activities/abundance of toys/electronics, pet expenses). Our standard of living has dramatically increased.
Our egos are insatiable; there will never be enough clothes, shoes, furniture, decor, presents etc…to satisfy our egos so we have to trick our egos into feeling sated by accomplishing our stated goals.
1. Buy forever stamps …in bulk (we hear the price is going up next week).
2. Have a goal to keep focused on to justify your restrictions on spending (“I’m not going out to lunch because I’m saving the money for a trip to Disney that we’ll all enjoy.”)
3. Negotiate phone & cable plans.
4. Meal and grocery list planning: look at your week, what it’ll be like, & plan accordingly. Get a crock pot. Use it. Keep healthy snacks in the car.
5. Use your flex savings account as a Christmas club; only submit your receipts in December.
6. Sell stuff on ebay, sell old gold to generate cash for “miscellaneous” stuff.
7. Go out on a financial date with your spouse/partner. Listen to one another, enjoy yourselves, strategize how you’re going to tackle your finances together.
Photos (except the rose, which is mine) courtesy of Clipart.