Managing Household Finances: Sticking to the Plan

8 Apr

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Unfortunately, having a plan is not the hard part.  Now you have to stick to your plan.  This is definitely a learned skill!  It takes months and sometimes years of practice to accomplish the skill of sticking to the budget.  And again, everyone must find and develop their own method of keeping track of their spending.  It’s kind of like dieting.  You tend to think, “Just one girl scout cookie won’t hurt!”  And then an entire box later…well, you know the story.  The same applies to budgeting.  You must watch what you spend every day.  And never give up!!!  If at first you don’t succeed, try, try again!

 

So, here are a few ways to give you an idea on how to get you to stick to a budget:

 

1.  Using cash only.  Dave Ramsey is a financial expert.  He does not believe in credit cards and suggests that a cash only system will best help you control your spending.  Simply stated, at the beginning of the month, you take out all the cash you have available to spend, divide it into categories and when it’s gone, it’s gone!  Here’s his step-by-step guide to his Envelope System.

 

2.  RESPONSIBLY using credit cards.  I am not about to argue with a financial expert, but the cash system did not work for me.  Mainly because I never got around to going to the bank and dividing the money.  We also weighed out the pros and cons of using debit vs. credit cards and decided that a credit card would be our best avenue for us.  (Don’t have to worry about how much money is in our checking account and get cash back for purchases.)  But in order for this to be effective, you MUST track your spending and pay off the balance in full each month!!!  That is so important that I’ll say it again and louder: In order for this to be effective, you MUST track your spending and pay off the balance in full each month!!!  One slip up and your budget is useless!!!  So if you know you are particularly bad with credit cards, I would not suggest this method to you! 

 

Either way you choose, you must regularly (I suggest daily at first.) track your spending.  I posted the spending log that I use to track my spending last week.  When I hit my budget, I stop spending.  We may not be eating our favorite meals that week, but we aren’t going hungry, by no means!

2 Responses to “Managing Household Finances: Sticking to the Plan”

  1. Kisha April 10, 2010 at 12:25 am #

    I get what they’re saying about not using credit cards, but I personally can’t stand using cash because every time I hand over a dollar bill, I think.. gee, that’s one/two/three/five cents that I didn’t make in credit card cashback bonuses! 🙂 But, we’ve never once carried a balance (even before I turned frugal-crazy) so to me, it’s not so much really a line of credit as a service that has volunteered to pay me money if I allow them to make my life more convenient at the checkout line. 🙂

Trackbacks/Pingbacks

  1. Managing Household Finances: Keeping Track of your pennies! « Adventures in Momville - April 28, 2010

    […] Sticking to the Plan […]

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