Issues with money management: What can I do?

posted 2 years ago in The Lounge
Post # 16
Member
7905 posts
Bumble Beekeeper

PP have given great suggestions on budgeting and optimizing your wife’ business. Computer science is a pretty popular and lucrative field nowadays. Have you looked at other jobs? Are you networking with people who work in your field? Have you thought about going back to school? Even an AA in a computer related field may open some doors for you. I like your user name!

Post # 17
Member
1756 posts
Buzzing bee

thecodifier :  Yes, exactly! Father’s Day snuck up on me, too. But, it’s a new holiday for me to celebrate, so that’s my excuse….

Post # 20
Member
1154 posts
Bumble bee
  • Wedding: July 2017

Yes, you need a budget.  A real budget, one that accounts for every cent you spend.  I use the Mint app/website and you can sync all your accounts to it so it keeps track of all your spending and income.  You can make a budget in there then go back and assign each transaction a category in the budget and see where you are going over.  Things like coffees and lunches can add up a lot.  If you’re getting a coffee at $3 and a lunch at $10 every weekday, that’s over $300 per month!  You can save a lot by making your own at home.  Same thing with dinner- I find eating out and alcohol are my biggest money wasters.  They don’t seem like a big deal separately but they add up to a lot and you only get momentary satisfaction out of it.

Post # 21
Member
4567 posts
Honey bee

So is she owner of the salon, an actual salon employee, or self-employed and just renting chair space from an existing salon?  If she is self-employed, then her best bet is limit her hours to weekends and find a second job to work Monday through Thursday – retail and food service generally offer very flexible schedules.

Track your spending.  Give yourself an allowance in cash and do not use credit or debit cards for anything that is not a necessity or emergency where you don’t have enough cash to cover (like car repairs or a new water heater).  Go check out some books by Dave Ramsey from your local library.

Post # 23
Member
8065 posts
Bumble Beekeeper

thecodifier :  is the weekend traffic at the salon mostly random walk-ins or does your wife have a set client base? If she has some dedicated customers she could also look into offering in-home (yours or theirs) hair cuts. When my friend moved she told her stylist that she wasn’t going to be able to keep coming into the city for her cuts anymore and it turned out that the stylist lives in the same suburb as she does so they just do it at home now. My friend gets a great cut and the stylist gives her a discount since she doesn’t have to pay out a salon owner for part of the profit. It works out well for both of them!

 

Post # 25
Member
1154 posts
Bumble bee
  • Wedding: July 2017

thecodifier :  I was seriously so shocked when I saw how much all my eating out and drinks here and there were costing me!  This is not an ad I promise (the service is free) but since using Mint I have been able to increase my savings by at least double.  Go to mint.com or search mint in your app store.  I suggest using the website to at least set up all your accounts and use the app just to quickly check your budgets on the go.

Post # 26
Member
161 posts
Blushing bee
  • Wedding: December 2016

Suggestions – 

-meal prepping, making coffee at home in the morning, etc

-scaling back her time at the salon, maybe developing a clientele (via word of mouth or review based sites like Yelp), starting as a wedding hair and makeup person? (doing so eliminates the need to pay rent for a salon chair, she can do trials during the week at home or in a cheaper rental office space)

-look up frugalwoods – it’s a moneymanagement blog and it’s really helpful to read and get in that mindset of what other people are doing to save money. 

 

Post # 27
Member
2019 posts
Buzzing bee

It seems like there are two separate issues: 

1) your wife’s business is a little bit of a mess. From your posts, I can’t tell if the business is actually losing money or if you guys are just spending more than you make. 

2) you don’t have personal budgets.

 

You guys need to sit down with your wife’s books and figure out how the business is actually doing. What are the expenses of the salon and what’s the income? Which is bigger? Figure out a salary for your wife. Being the owner doesn’t mean you just take all the cashflow out of the business and use it for personal expenses. Pay yourself a salary, and don’t spend more than that. You may find the salary you are making isn’t worth the time. If that’s the case- either find a way to make more money or sell the business and get another job. MOST businesses lose money the first few years. You have to be financially stable to keep a business going at first.

 

Once you know what your actual incomes are, set a budget. Deduct rent, utilities, food, insurance, etc. See what you can cut down on. Get rid of cable, drop your cell phone plan, sell one car, etc. Buy less expensive brands, cook everything at home and buy in bulk. Cut out anything that is not necessary. Going out to dinner, alcohol, new clothes, random knick knacks, junk food snacks, etc. If it’s not keeping a roof over your head, keeping you healthy (food, insurance), general self care, etc- stop spending money on it. 

Make a budget for savings. Even if it’s only $20 a week, put it aside into a savings account each month and don’t touch unless of emergencies. 

Make another budget for things like gifts, date nights, special treats, etc. Even if you are only putting in $5 a week, it will add up. This should be a smaller budget, but I always like to keep a special budget for ‘fun things’. If I ever go over budget, I take from this budget before touching my savings account. 

Post # 28
Member
4823 posts
Honey bee
  • Wedding: June 2014

thecodifier :  Track all your expenses and ask yourselves if there is a cheaper way (like making coffee at home instead of Starbucks, for example) or brown bagging lunch.  

If she sold her salon, could she find work as a hair stylist nearby?  Would her clients follow her?  That way she wouldn’t have the cost of maintaining a salon but could use her expertise.

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