Christmas In July?

Normally, I am the one that despises the Christmas shopping.  The "who to buy for" list and adding up the cost of everything.  Oh, the cost!  But this year, I am pumped!  It's only July, but I have our list ready to go with who to buy for, how much to spend on each person and an {empty} spreadsheet with ideas for each person.  Obviously, it's July and the nieces and nephews haven't started their "I wants" yet.  But I'm trying to be proactive here.

Like I said, I created this spreadsheet--more like a chart right now...  But I want to be sure that we are planning for every person and every extra expense that Christmas may throw at us.  Right now, I am up to seventeen people (and Kinley, of course) that have made the cut.  We don't buy for the adults {aside from our parents and grandparents} but only for the kids.  We are blessed with lots of little ones!  But then I also added in the holiday cards, wrapping and postage.  What am I forgetting?

I have noticed that the last couple of years, the participating families sending Christmas cards are just dwindling.  It really makes me sad.  That is one of the best parts about the holidays.  You get mail that isn't a bill!  And normally, that mail has adorable family photos that you want to see.  Photos of people that you rarely get to see!  As easy as photo cards are these days {we do ours at Walmart} why doesn't everyone send them?!  So here it is July, and I'm asking you now, to send me a photo card.  Mmmm, K?  It makes my heart smile.

I did a quick search on my beloved Pinterest for Christmas photo ideas this morning and came up with nothing.  I want to be prepared!  I know that some cards have cute summer photos on them and I wanted to see if I could be inspired to take something now for the card later.  Okay, honestly, I am hoping and praying for this kind of card:

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but I know that our chances are way slim.  So I'm planning for the family of three card photo.  And so far, nodda.  I'm hoping that I can con convince one of my fancy camera friends to take on the challenge of doing our family Christmas pictures {hint, hint}.  Last year=expensive nightmare. {and for whatever reason, I can not find a single picture from that photo session.  I will keep looking.}

We decided on a tradition that Santa can only bring three gifts to our house because of his sleigh only being able to hold so many toys for all of the children of the world.  We plan to continue that this year.  So her big gift will be from us and then Santa will bring her three more.  And this year, she just may be able to get in to the gift of giving and I am so, so excited.  And let me clarify--this is still going to be a Christmas on a budget. We are not being extravagant on gifts--because that to me {us} is stupid.  And since I'm always honest on here, I will tell you now that we will spend a total {and not a penny more} of $870.  That is for all seventeen people, Kinley, cards, postage, wrapping, and each other.  Is that high?  Do share--because I am honestly interested.  And if I can save money, you bet I'm going to do it!  My goal is to come on here in January and announce how UNDER budget we were from Christmas.

I was informed on my personal FB account this morning {have you "liked" Living on Trees on FB yet?  why not?} I was told that every Thursday through the summer, Target clearances their toys.  I will be there every Thursday for the rest of the summer.  I don't know what I am shopping for yet, but if I see a good deal, I am on it.

And I can be on it already, thanks to Connie--the budget coach!  We are almost fully funded for all expenses Christmas.  Yes, that is a first for me, ever, like--ever.  To not put Christmas on plastic, and not stress to holy heaven about how to pay for Christmas--you just don't even know.

I guess that's why I am writing a Christmas in July blog post.  I can finally ENJOY the holiday for what it's about.  Creating the memories, not the debt.  And if you haven't started your savings yet, it's not too late!  You still have 163 days left to save!

A Quick Step-By-Step

I have been asked on numerous occasions about our budget coach and financial planning "stuff" from Dave Ramsey.  I am always more than eager to share and pass along the good info...

So with that....

Here is the Financial Peace University class that we took through our church.
1. If you need to find a class offered in your area, click here.  Just put in your zip code there on the left and off you go.  I'll cross my fingers that there is one in your area.
2. If there is no class in your area, but you still want to get on board, you can.
3. The home study course is $99.  I know it is a lot of money.  Trust me, I know.  But I can honestly say that it will be the best $99 you will ever spend.  Save a little each month if you need to...or just don't eat out all month and save up.  
1. The benefit to the home study route, obviously, you won't need to leave home or find a sitter, or whatever.
2. It is the SAME DVDs and information that you would receive by going to the class.
3. You can study at your pace, speed it up/slow it down, whatever.
4. Following the completion of our course, we didn't know where to start.  We were a tad overwhelmed with the information and the resources.  We needed someone to help us get things organized and put "in order."  That is where our budget coach, Connie, comes in.
5. We found her by using the Dave Ramsey site and going to this page.
1. On this page, you will fill out your contact information and then they will get back to you via email with names of counselors (coaches) in your area.
2. Our coach offered the first class free to assess our situation and get her opinion on our finances.  From that point, we were able to decide if this was something that we wanted to do.
3. It does cost!  We paid about $500 (?) for her services.  Now, don't freak out!  $500 is a TON, Ton of money.  We didn't pay this in one payment.  We paid $165 over three payments.  She worked in those payments where we could afford it in our budget.  So we paid it over the span of 4 or 5 months.
1. If you feel that there is just no way that $500 is something you can do...you aren't alone. I thought for sure that we could never afford her.  There was no way.  We had zero money to spend on "extras."  Let me just tell you....we did it.  And it didn't hurt.  It was amazing to know that we were able to pay for this service, in cash, and not feel the pinch.
6. My one piece of advice to you, if you are interested in taking these steps, is to really be ready.  Be ready to allow someone to TELL YOU WHAT TO DO and HOW TO DO IT!  Your coach will tell you NO more debit or credit cards.  Your coach will tell you HOW to spend your money.  Your coach will HOLD you responsible for your spending.  Your coach will EXPECT you to be serious about your finances.
1. That said, if you feel that you are not ready to be serious and really put forth an effort, don't waste your or their time.  

Remember, we made a goof, we bought a stupid car.  But we learned so much from that goof.  You are not expected to be perfect.  Just to be real.  And don't ever feel that your situation is so bad that you are embarrassed of how bad things have gotten.  There is always someone worse off.  Our coach reminds us that she once had a client with over 400K in student loans.  Yeah, I know.  So never feel embarrassed or like you can't get help.  

Anniversary On a Budget

If you've read the previous post from this morning, you know that today we celebrate our four year anniversary.  Four years doesn't seem long enough to have experienced all that we've done together!  I actually had to recount the years to be sure that it was only four!

I typed up that post as my digital card to my husband.  I guess we're non-sentimental this year because we both agreed that a card wasn't necessary and that we'd just celebrate our day over the weekend.  Pretty romantic, huh!?

We have "big" plans this weekend and we're pretty excited about it!  We're both kind of history buffs and really enjoy exploring.  There is a place in central Illinois that I visited as a sixth grader and that was the one and only time that I visited.  Since then, I think about it often and remember how much I enjoyed it and how fascinated I was by the story--the unsolved mystery.  So, we'll be visiting Cahokia Mounds this weekend as our "getaway" on a budget.

My mom is keeping Kage and Lucy will be going to day care.

Last night we took Lucy to make her vaccinations current {$170 worth!} and get her "day care ready" with a clean bill of health from the vet.  After having a two-year-old and a dog in one tiny office, I think that we can say that we got a small taste of what two children would be like.  It was not easy!

We budgeted four hundred dollars to blow on ourselves for this trip and to us, that seems like plenty to have a good time!  Gas, hotel, dinner out, maybe a glass of wine or two....  Free childcare and the doggie day care will only run about $150...so this is a much more affordable vacation than say......a tropical destination.  Don't get me wrong, a beautiful white sand beach would be amazing right now, but it's just not happening.  Maybe next year.

We're leaving Friday night when Richie gets home from work and will drive to my mom's to stay the night.  Saturday morning, it's up early and on the road!  I am not too good at leaving Kinley, and we've only done it one other time....but I know that I need to nurture my alone time with my husband as well.

It will be a welcomed break to get us away from the ordinary, even if it is only one night.

O.K.

Yesterday, I started our July spreadsheet for our budget and was filling in our monthly income at the top...and it hit me.  My school salary will be coming to an abrupt end in August.  The days of throwing $1500 at debt each month are going to be over.  And I panic.

I know that Connie {the budget coach} said that we would be okay on one salary, but I don't want to be okay.  I want to be gazelles.  I want to get rid of this debt weighing us down.  I want to build that 20% down payment for our home.  I want to LIVE like no one else.  We can't do that on one income.  We will be okay.  Never before has that word sounded so blah to me.

I apply to at least 2-3 districts a week.  Sometimes, more.  Living in Chicago-land affords me several area districts where I can work.  And I believe that I have applied at all of them.  I send applications.  I send emails to the principals.  All that I get back are the "we filled the position internally" responses.  I am so defeated!  The district where I worked RIF'd over 400 teachers at the end of the school year.  I basically counted that out as an option for fall employment.

The past couple of days, I have been watching the call back list and the available position list.  Names were being crossed off and positions were filling up.  And then yesterday, the last name was crossed off.  And there are positions still listed.  Finally, a glimmer (although a very small glimmer) flashed before my eyes.  I typed up an email to my former principal asking if he's heard anything about what may or may not be open for me to apply to.  He claims that it is still too early to know for sure, but to keep in touch and he would let me know as soon as he heard something.

So, now I have some hope.  Maybe, somehow, someway, I may get back to the district where I was last school year.  I probably won't be at the same school that I was last year, but the same district.  Which is kind of what I wanted.  So I'm okay with that!

I guess that I just wrote off the idea of teaching for the 12/13 school year and now that there is a small chance, I found hope.  Hope that we will be "okay" but in a much higher level of "okay" than before.

Pinching Pennies

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Happy Monday!  What a busy weekend we had!  My husband had to work on Saturday and on weeks where he has to work six days, it seems we never get that relaxed down time that we truly need.  We did have a beautiful weekend, nonetheless that I will recap for you later.

But I wanted to write one more blog post dedicated to finance and budget before I let go of this topic until anyone else has questions/comments that I can answer.  So with that....

Let's talk about pinching pennies.  This is written to be informative for you and in hopes that you will share tips with me as well.  Let's help each other out, shall we?

First, let's revisit the car.  I have mentioned it several times on here about the regret of taking on 10K in debt just to save money on gas.  We were dumb.  Don't do what we did.  But, to make any light out of a really dark decision, we are saving tons of money on gas.  Now that I am not working, I never really go anywhere.  Or anywhere out of a ten mile radius.  I can fill up my tank and run on it for a couple of weeks.  That alone, is a huge savings.  It has taken our gas budget from $600 to $400 and now down to about $300 a month.  Huge.  I plan outings that are super close to home.  We go on walks when we're bored.  I find things to do at home or in our neighborhood to entertain us.  Easy.

Coffee.  It's no secret that I am a die-hard fan of Dunkin Donuts coffee.  Medium, iced, cream and sugar.  That is my drink of choice.  But, at $2.25 a day, it just wasn't worth it to me. I mean, I love it-really, really love it- but I love paying off debt more.  So I have been (gasp!) brewing my own coffee at home.  It took a long while to find a brand that I could handle, and that didn't tear up my ever so finicky tummy, but I have found it and I really enjoy it.  AND, this weekend, I learned that I can take the leftover coffee from my morning brew and make a wonderful iced coffee in the afternoon.  Win!  It's Papa Nicholas brand, for any of  you wondering.  And I can't even tell you what it costs, because I'm not sure, but I do know that it was on the cheaper end--at it's way less than $2.25 a day.  As a side note, I did have a Keurig, but it died.  Which is fine cause the K-Cups are more than I want to budget for coffee.  End of the side note.

Laundry Detergent.  That stuff is not cheap.  I love the smell of Tide for Cold Water--but the price is just stupid.  I couldn't see paying that much for just the scent.  So now, I buy my detergent at the Dollar Tree.  It's a dollar store (and I'm sure it's nation wide) and they have detergent that is pretty decent.  It smells good, cleans our clothes, and is only $1.  Serves it purpose.  I also buy dryer sheets at Dollar Tree as well....and any other cleaner that we may need.  It's $1!  You can't go wrong!  Now, if it didn't do it's job--I wouldn't think it was a good place to pinch pennies.  But it does, so I do.  And, pinterest has recipes for homemade laundry soap that is equally as cheap, but it makes like 5 gallons at a time and I have zero space to store 5 gallons of detergent.

Aldi.  I used to despise Aldi.  I remember shopping there with my parents when I was little and I HATED it. I felt poor.  I didn't like it.  But you know what, my parents lived on one income and had a house and three kids.  We WERE poor!  My dad was a small business owner, in a small town.  He worked his behind off to provide for us.  --stay on track--  Aldi has come a long way since my days of despise.  I now do 98% of our food shopping there.  You save so much money!  I refuse to do extreme couponing.  I don't have the time, attention span or storage space to even begin that mess.  We eat pretty darned well each week for about $100 or less in groceries.  I have made recipes from pinterest using Aldi ingredients and they taste wonderful!  I can share those if you are interested.  There have been a few items from Aldi that I deem not acceptable and those are:  mac n cheese, coffee, and chicken nuggets.  So I still do use the "regular" grocery store for those items.

Yard Sales.  Let's face it, I'm a girl and I like to shop.  I hate feeling "broke" when we're not broke.  We're living on a budget and paying off debt.  But I still want to shop!  So I have dived back into yard sale shopping--occasionally.  It's just fun to get something new--and at a great price.  I don't go all the time, and you won't find me waiting on one to open at 6 a.m.  But we will venture out in the later morning if we have nothing to do and are up and moving.  This past weekend, I got an adorable basket, a pretty good sized one too, for K's room.  It now holds her current stuffed animal loves.  And, it was $1.  We also scored a stacked plastic bin thing in pink and purple for her room.  More organization for her mess of a toy box.  It was $3.  And then my big item, that was probably a dumb move, but maybe not....a desk. It's white and super cute and it was only $5.  Now, currently, we have zero room for it, so it's in the garage.  But my neighbor was into refinishing furniture before downsizing and moving in to an apartment, so I plan to pick her brain about painting it a bright pink and later putting it into Kinley's big girl room.  My next yard sale find, will be a chair to go with it that I can paint green.  I am super excited about it.  So you see, my shopping itch has been scratched and we spent $9.  Score.

Budget Billing.  I did this more for my spreadsheet planning than anything, but what the heck.  It keeps our gas bill at a steady $34 a month, every month.  No surprises.  You can set this up on (most?) utility bills.  I was able to do this online.  I just checked the box for "budget billing" and it estimated what our new bill would be, right there on the spot.  So now, I know that every month, I need to budget for that much for our gas utility.

Craigslist.  This should have gone after yard sales, I guess.  But I also do a lot of shopping on Craigslist.  I recently bought Kinley a new bedding set for $15.  It's a princess theme, which I don't like, but it's $15--regularly $50.  The lady bought it for her daughter, in hopes that she would start sleeping in her own bed, and it flopped.  So she just wants to get rid of it.  It's never been slept on.  So, Craigslist is not only a place to make money, but to find steals too.

Free Days.  For our daily outings, I scour the internet to find free events.  Kinley needs stimulated, or she makes me crazy.  Sitting at home day after day is not an option.  For me or her, really.  So I plan things out on a printed calendar (just used MS Word to print one) and fill it up with as much as I can.  The only "pay for" summer activity is her dance lessons on Tuesdays.  Other than that, it's free stuff.  We are super fortunate to live in an area with amazing park districts.  Which is why we stay where we are...  The park districts have so much to offer, and mostly, things that are free.  On Wednesdays, we are doing "Story time in the park" from 10-11.  Each week it's at a new park in the area.  They will be reading a story, doing a nature talk and discussing local wildlife, etc.  And after, we can play in the park or have a picnic lunch.
We also have a free splash park in our town.  Kinley loves the splash park!  The library often hosts a free story time, or we just go to sit and read and do puzzles.  Kage loves to check out puzzles and books to take home.  So if there are no free events for the day, I let her go to the library.
You can also just go on a nature walk.  Have your little one look for different leaves, or rocks.  On Friday, we went looking for rocks and pinecones and then brought them home to paint.  She had a blast!

Meal Planning.  We initially tried the e-meals program.  It was a great starting point for us, with both of us working.  It planned the meals, shopping list, recipes, everything.  We did the 3 month plan and I feel that we got our money's worth.  But with the start of pinterest and finding easy recipes there, I learned that doing on our own was just as easy.  I now plan our meals, staying on the cheaper to make recipes, for the full week and then some.  Then I make my complete list and head to Aldi.  Like I have said before, I am able to feed our family of three for $100 or less each week.  You just have to take the time to plan. We now have favorite meals that we cook almost weekly, so it's a lot easier than dreaming up new, fancy recipes all of the time.  We're living on a budget, we eat simple, but good.  We'll save the fancy stuff for when we're debt free.  Again, I will share some of my recipes if you are interested.

Hair-cuts and products.  This one was hard for me.  I was always accustomed to using salon products.  I paid $25 a bottle for shampoo and conditioner, and my hair products would run around $15-$20 each.  I spent good money on my hair.  Haircuts/styles would run me about $160 every 6-8 weeks.  Yikes.  Thinking about that now, I feel dumb.  Since learning to "live like no one else," I have learned that cheap inexpensive products are really, just as good.  I now use the Suave Professionals line of shampoo and conditioner and honestly, can't tell a difference.  I'm not joking.  I can not tell the difference from this and my Biolage.  I can't even tell you how dumb I feel after spending God knows how much for that expensive stuff.  Suave Professionals.  Love it.  And, it's like $2 for a big bottle.  Also, my products.  I have stupid hair.  If I don't do anything to it, it's the biggest afro ever.  I wrote a post about it, like forever ago, so you know that I can't go sans product.  I usually go curly, since I'm now a lazy SAHM.  Not saying that SAHMs are lazy....but this one can be!  So I need curling product.  My old stuff was $19 a tube.  Small tube.  Now, I use Garnier stuff.  It's like $4 and does almost the same job.  When/If I flat iron my hair, I go sans product.  Now, I know that this may be bad, but it's what I do now.  I do have some left over Chi product that I sometimes put in it before I dry my hair, but mostly, I just dry and iron.  And, I scored a new flat iron (my Chi died) for $19 (this thing was regularly over $150) on one of the "one sale a day" sites!  My haircuts?  Well, I decided that since I couldn't afford the $160 stylist, that I would just let it grow.  Not such a good idea.  It got crazy unruly.  So I held my breathe, and walked into a Great Clips.  Twenty minutes later, I walked out unstyled but trimmed.  And with tip, I paid $16.  I'm sure that she would have styled it, but it would have cost me more and I really didn't mind just putting it into a ponytail for the remainder of my day.  The next day, I styled it and loved the cut!

Energy Savers.  Luckily, we don't have the pay for water in our apartment.  One less bill, right?  But to make a savings on everyday chores, I always have our dishwasher on the "no heat" dry cycle.  It probably doesn't save much...but some.
And our washer, washes all clothes in cold water.  And I swear, I don't notice a difference.  Our clothes don't stink.  The only exception to this, is our bed sheets.

Those are just a few of the things that I focus on to pinch pennies each month.  They really aren't much, but it's a start.  I am working to add to this list and find more ways to start saving even more each month.  Our current "cost of living" is about $3530.00.  That's what it costs to run our family of three each month.  I know this because of our budget.  So I know that we need to make as much over that as we can to put toward debt repayment.  Or, my goal is to drop that number as much as I can by pinching pennies wherever possible and increase our income each month.  Do you run your family on less?  Can you pass along any good budget saving tips?

Budgeting With Envelopes

I was so excited to see that some of you are interested in the budget and envelope system that we are using in our household.  Like I have said many times over, I am obsessed with budgeting and am so determined to make this work for us.

So let's get to it, shall we?

I tossed around the thought of how personal I planned to get with this topic, cause let's face it, money is a hush topic.  For whatever reason, I honestly don't know why.  But this blog has always been an honest and open outlet for me regardless of the topic.  So why change now?

Where We Started
We took the Dave Ramsey Financial Peace University class through our church.  This allowed us to really get on the right mindset and be prepared to work as a team.  Dave Ramsey rocks.  After the classes ended, we were set out to figure out this budget thing.  Yeah, right.  We had no clue where to start.  We had all of the tools, we had the motivation but we didn't know where to start or where to go from there.  We felt defeated and discouraged before we even got started!  It was not a good place to be.

That's when we decided to hire a budget coach.  She is trained by Dave Ramsey's staff and because we completed Financial Peace University, she gave us $100 off her sessions.  We paid her three payments (over three months) of $146.  That "bought" us six months of in person counseling and a lifetime of phone/email contact.  The BEST money we have EVER spent.  Ever.  With the help of Connie, we developed a monthly budget, the envelope system AND the mindset to keep going even when it seems hopeless.

Budget
To build our budget, we were given a fancy schmancy spreadsheet in Excel.  It is a Dave Ramsey spreadsheet that has tabs for everything.  Budget (how much it costs to run our home), Distributed Budget (how our money is spent each month), Savings (our savings account micro-managed), and our Debt Snowball (a list of all debts, balances, monthly payments and interest rates).  There are several more tabs but those are the ones we use.

To make your household budget, you don't need a fancy schmancy spreadsheet.  You can use a sheet of blank paper.

1. Write down all of your bills.  ALL of them.  
2. Figure out your income.
1. Our income changes weekly.  My husband is paid hourly but each week he works different hours.  Sometimes he's at 40 hours and sometimes he works 60 hours (bless his heart!).  For our budget, we always use the 40 hour check.  Anything that he makes OVER that, is extra for debt repayment.
2. I am paid twice monthly from the school district.
3. Once you have your bills and your income extremely defined, you are ready to start your budget.
4. Decide how you want to work your budget.  We do weekly--because my husband is paid every Thursday.  If you get paid on the 15th and 30th, do twice monthly budgeting.  If you and your spouse are alternating, like us, then weekly may work for you.  
5. At the top of our spread sheet, we list the pay dates for the month.  We (normally) have four columns, but this month, we have five due to the extra week in June.  After each date, write it your expected income.  Like I said, for us, we write down his 40 hour check.  
1. For example, for our June budget, we would list:
1. June 1-- $100 (not really, but let's pretend that he makes $100 for 40 hours)
2. June 8-- $300 (this would be my two week check from the school + his 40 hour check)
3. June 15-- $100 (his 40 hour check)
4. June 22-- $300 (mine and his)
5. June 29-- $100 (his)
2. Now, let's say that on June 1, he got a check for 55 hours instead of the 40 that we budgeted, I would then edit my budget to show $150 instead of $100 like I initially budgeted.  That extra $50 would just go into savings (unless we were short somewhere and it needed to go somewhere).
6. Now let's talk about bills.  Our budgeted bills are:  Rent, Mortgage (yes, we own a home but have renters in it, so it's basically a wash when the rent income comes in), Auto Payment (darned car!),  Electric, Gas, Trash, Medical Co-Pays, Internet/Cable and Auto Insurance.  Those are our household bills.  These are bills paid by check or auto payment via bill pay online.
7. Then you figure in your debt repayments.  We have one two credit cards to repay (stupid student teaching!), a car loan (darned car!) and my student loan.  These are paid via check or online payment.
8. And now you have to look at your household spending.  For us we have Groceries, Eating Out, Clothing, Gas, Entertainment, Babysitting, Office, Blow Money, Paper Goods, Personal Hygiene, and Car Maintenance.  These are paid in cash.
9. You have to know how much you spend for each item.  The household bills are pretty easy, they come every month and usually are consistent.  If not, average high and go with that amount.
10. Debt payments, use your minimum payments for the budget.
11. The household spending categories are your envelope system.

Once you have all of those items listed and a $ amount assigned to each one, you are ready to budget.

You need to be mindful of your bill's due dates in order to schedule them appropriately with the pay check that is closest to the due dates.  You will need to shuffle the payments throughout the month between checks until you have every bill accounted for.  This will be the most difficult part of budgeting.  It took me about three months to get the hang of it, honestly.  But if you work it enough, it will work out.  

Now let's talk about the envelopes.  

The household spending categories that I named above in #8 are our envelopes.  These are cash expenses.  Things that you can walk in and use cash for.....NO MORE DEBIT CARDS!  Here is how we budget our envelopes.  We put a monthly total for each category.

Groceries:  $420 (we put in $105 a week)

Gas:  $400 ($100 a week, this came down from $600 while I was traveling to work)

Eating Out:  $95

Paper Goods (this is paper towels, cleaning products, baby wipes, etc.):  $50

Entertainment:  $50

Blow Money:  $80 ($40 each)

Babysitting:  $50

Clothes:  $50

Personal Hygiene:  $65 (hair cuts, waxing, make-up, etc)

Car Maintenance (oil changes mainly):  $25

We use the envelope system from Dave Ramsey and the course we took.  You can use standard white envelopes if you want, or baggies!  You don't need to get fancy.  But you do need to make sure that they are  travel-able.  Like, you need to take them with you.  Because, this is your spending money.  NO DEBIT CARDS.  You can even get an accordion style envelope and use that.  This is our system:

If you want to "make your own envelopes" you can here.

We started keeping a running total on the outside of the envelope but have moved away from that being necessary.  The key is, that when the money is gone, it's gone.  If you blow all of your eating out money on one dinner on June 3, then you don't eat out again until July.  End of story.  If you blow all of your grocery money, then it's cereal and milk till next pay day!  You have to be smart about your spending.  But by using this system, you KNOW what you have and what you don't.  And, paying cash for things is so much more personal!  It really makes you think twice when you throw that extra bag of chips in the cart.  That's like a $5 bill being handed away!  It's a lot different than a swipe of a debit/credit card.

In our six months of using envelopes, we have never gone hungry.  We have never had to call in to work because we didn't have gas.  Use your head and you'll be fine.  If you don't have cash for it, you don't buy it.  Period.

Putting gas in the car has been the only hardship that we've encountered using the envelopes.  Almost all pumps are pre-pay if you don't use a card.  So you do have to take your cash in before you pump.  Really not a big deal, unless you have a 2 year old in the backseat.  So I just make a point to send my hubby to get gas in the evening or I get it after he gets home.  Or we fill up on the weekend when we're together.  Our coach also said that you can take your monthly/weekly gas budget and buy a gas gift card for yourself and then just swipe that.  That's clever too.  But we have become accustomed to just pre-paying.  It really isn't a big deal.

So I've touched on building your budget and the envelope system.  I am so confused right now....so I know that you must be too.  It's a lot harder than I expected to sit and type out all of this....  PLEASE, ask questions if something isn't clear or if you need more explanation.  Cause if you're like me, you won't get it at first, it will take a lot of work.  Let me be a good steward and help you.

The last thing that I want to touch on is micro-managing your savings account.  In January when we started with our coach, we had zero savings (aside from retirement accounts).  Now, we have a nice savings.  The first step is to establish your EMERGENCY FUND.  This is $1000.00 that is there for emergencies.  Not, I want a flat screen emergency, either.  More like, "oh no!  My car broke down and needs a new ______!"  I know nothing about cars, so fill in the blank.  Normally, that would be a super crisis.  For us it would be.  But not now, we have $1000.00 in our savings just for that emergency.  And thankfully, *knock on wood* we've not had an emergency, yet.

All of your extra money goes toward that emergency fund until it's funded.  We sold stuff on Craigslist, Ebay, etc. to build that $1000.00.  It wasn't easy and it didn't come quick.  Luckily, we started this system around tax refund time and that helped boost our emergency fund.

Once that is established, you begin building your savings account.  Here are our savings categories: Car Registration, Gifts, Christmas, Medical, Pet Care and Debt Repayment.  Let's break this apart.

Our savings account is one account.  But we use a spreadsheet to break down the balance into categories.  So the bank shows that we have XXX in our savings, but to us, we see it as  XX in car registration, XX in Gifts, XX in Christmas, etc.

After you have all of your household bills, debts scheduled and envelopes funded, you take the extra money and start allocating it into savings.  Even if it's $1 in each category, it will grow.

So car registration, we live in IL and unfortunately, it's not so cheap to buy your car tags.  Like $115 a year, per car, or something?  I don't even know.  And since this is a yearly expense, we have to budget for it.  So we took $115 and divided it up by 12 months and that tells us how much has to be saved monthly to have the money ready to go by the time it's due.  No panic what-so-ever!

Gifts:  This category is one you have to stay on top of because it changes monthly.  Our norm is $50 a month.  It builds, monthly, because sometimes you don't have to buy anyone anything!  But that's why it's in our savings account.  But the months when you have Father's Day, birthdays, etc. you need to put aside a little extra.  This month, we allocated $150 because of Father's Day and graduation gifts.  Make sense?  So it will sit in the savings until I spend it.  For gifts, I will use my debit card and then do an online transfer from savings to checking to cover it.

Christmas:  Christmas comes every year.  And every year, we act like it snuck up on us and we end up stressed and fighting over money.  Where will we get the money for gifts?!  Not this year.  Our Christmas category already has over $300 in it.  Not bad at all for June!  We put in whatever we can afford for the month.  Sometimes we put in $1 and sometimes we put in $200.  Just depends on how the money comes in that month.  If it's tight, don't put anything in Christmas.  This is where you have ultimate flex.

Medical:  This gets $50 a month.  This is for medical that isn't a co-pay, because remember, co-pays are included in our household bills.  With me seeing my shrink twice a month, and having a toddler, co-pays are a monthly expense.  Maybe they aren't for you.... But medical is for dentist expenses, contacts, glasses, deductibles, etc.  It grows until it's used.  Ours has about $300 in it now, but I have to buy my contacts so about $150 will be wiped out.  But see how I have no worries about ordering contacts now?  The money is there and it was painless to save it!

Pet Care:  Obvious.  Lucy's rabies vacc, etc.  We save $20 a month for this.

Debt Repayment:  This category is my favorite.  Now, let me back up for a minute.  You want your budget to balance to ZERO every month.  That means that EVERY dollar that you bring in, is allocated SOMEWHERE.  So when you get to the bottom line, you are at ZERO.  Make sense?  So when you have paid all of your household bills, all of your envelopes, all of your other savings categories, you take what's left and put it into the debt repayment column.  This column can grow and grow until you have enough to make a substantial payment on something.  There are some months that nothing goes into this column <insert Joy's sad face> but then there are times like now (with an extra pay week in June) that our whole check will go into this column because I've made all of our other bills fit in the other pay weeks.

Dave Ramsey suggests attacking your smallest debt first.  Even if it's not the highest interest.  You do that to help you gain momentum and feel like you've accomplished something.  When you get to cross off a debt, you feel like you can accomplish anything!  Trust me, we've crossed off three!

Here is our savings spreadsheet:

You can see the categories at the top in yellow.  There are several categories there that we currently aren't using, because well, we can't really fund a vacation until we pay off our debt.  Debt pay-off is king.   That is first and foremost.  And until you get to that point, you don't get to play.  You already played, that's why you have debt!  Right?  Well, except for student load debt....

Okay, exhale.

I'm sure that this is way overwhelming, and who knows if you even got through it all.

Like I said, please, please, please ask me questions.  I want to help!