Friday, September 18, 2009

Financial Friday

Welcome to Financial Friday!

Friday is the day that I sit down and pay bills, balance the checkbook, and update the budget. I just feel better if I can do it once a week. When I go longer, it seems too overwhelming, and I then will procrastinate......which makes it even more overwhelming. If you don't have a regular schedule for managing your finances, I really encourage you to start one. Even if you aren't thrilled about where your finances are at, it really makes things more manageable if you have a handle on where you stand financially.

As part of our simplifying this year, we've gone to paying cash for a lot of our expenses. But there are still some things that it's just so much easier to pay with a credit or debit card. When I have to fill the car up with gas, there is no way that I'm going to unstrap my son from the car seat, stand in line behind the lotto fanatics to put $20 on the pump, go back out and pump the gas, go back in and stand in line again for my change, go back out and strap my son back into his car seat. That's definitely NOT simple!

I use a coupon accordion file to keep track of our cash, just like you would with an envelope system. At the first of the month, I look at our budget and total up the amount of cash we'll need for the next two weeks. I write a check for cash, and make sure that I get the correct change to be able to break it down into the different categories in the accordion file. I do it again in the middle of the month. That way, if we overspent in the first half of the month, we can try to make up for it in the last half by adjusting in that category.

I am really liking the simplicity of the cash system. I don't have to save receipts and worry about getting them into the budget and/or check register. Once the transaction is over, that's it. I only take the money out of the file that I plan on spending and leave the rest at home. This way, I have to consciously plan to overspend before I use my debit card to make up the difference. I do have to be careful to make sure any leftover change gets put back in the file. If not, we tend to spend it on who knows what and then wonder what happened to it. I also find it easier to save a little here and there when I have the actual cash, rather than just a number in my budget and the money in the bank. If I save just $5 from each of the categories, this can really add up!

I keep track of our budget in an Excel spreadsheet. I wouldn't recommend this for everyone. I work in accounting, so I have a good knowledge of and am very comfortable in Excel. I say do what works best for you.....just make sure that you're doing it!

My husband hates the Excel spreadsheet. He would rather it be on old fashioned ledger paper. The problem is, he hates doing paperwork, so I do it. Since I do it, I am going to do it the way that is easiest and most efficient for me. I do printouts occasionally for him. As far as he's concerned, we're doing okay if there's still money in the accordion file.

Friday is a great day to sit down and manage your finances. It's good feedback for how your week went. I like knowing where we're at by Friday so when we're planning our weekend, I will know what we have in our budget for house projects, yard sales, entertainment, etc. It keeps it from hanging over my head all weekend, and frees me up for living a Simplistic Saturday.......tune in tomorrow for more on that.

Do you have a regular schedule that keeps you on top of your finances? What budget system works best for your family? I'd love to hear your comments!

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