Post # 1
I am rather disgusted right now with me and my Destination Wedding together. I just calculated our yearly total income from all sources and it should be plenty to live in a decent manner. Plus I am super thrifty when I want to be. We are not going to be living a steak and lobster lifestyle but it is ENOUGH, if you know what I mean.
so why are we broke for big chunks of the year? well, I blame it on our self discipline related to the WAY we get our money. the timing.
When we were living paycheck to paycheck we managed a LOT better, though we had less money then. The problem is, a lot of our money now comes from larger amounts 2x a year. Not all of it but a good portion of it. And that’s where we get into trouble. Yes, we know how long it has to last and where it all needs to go. we are good about some things, we try vry hard to pay in advance any bill that we can manage to pay that way so that our water is covered for X months and the internet for X months, etc. The problem is still that we seem to have a lot less restraint when we “seem” to have a lot of money available even when we know that it has to last a long time. 🙁
So we often allow ourselves to splurge, then at the end of that financial period we are broke and seriously regretting it and back to Ramen time.
We need to get a handle on how to manage larger sums as if they were weekly paychecks, how to “trick” ourselves into leaving it alone, or just ideas in general from anyone who has been there. It’s all working out well on paper, just not so much in reality. This was a large problem with us going over on the wedding budget too… there SHOULD have been enough for the wedding plus real life but we ended up broke after the wedding, and quite shocked about it as well.
Post # 3
I don’t know if this will work for you but a lot of people do well on the jar system. You take out the amount of cash you will need for the week and have to live on it. Don’t go back to the bank until the next week. It might be easier to keep track of the amount of cash you can really spend if it is physical cash instead of invisible plastic.
Post # 4
Oh, I feel you there. Everytime I get a large sum in my account, I feel rich. And I act accordingly. lol
I’ve read that you should you “pay” yourself each week and once that amount is gone, it’s gone. Also, to set up everything to be paid automatically, including a set amount that is transferred into a savings account each month. An account that you are NOT allowed to touch:)
I highly recommend ING Direct. It is seriously the highest yielding savings account I’ve found. I was so excited the first month I checked my statement even though I had only earned $5.00 in interest. It was better than the .50 cents my bank would have given me.
Lastly, go check out a website called I Will Teach You To Be Rich. It’s a young guy and he is seriously a financial genius. That site will tell you every single thing you need to do to start saving.
Post # 5
Give yourself an allowance. Similar to the jar system. Don’t keep extra cash around the house. Don’t carry debit or credit cards with you day to day. It is too easy to spend money that way. Only carry what you need each day. Only take from the bank what you will need for the week/month (depending on how much you trust yourselves). If it is too easy for you to go to the bank and make withdrawels maybe put some of those larger amounts immediately in short term cd’s so they will earn a bit of interest but more importantly you will be penalized if you touch them. You could access it in a few months without penalty. Would that help you leave it alone? The whole point would be to make it inconvenient for you to overspend.
Post # 6
I second the Jar approach – or at least, giving yourself a predetermined weekly or monthly allowance in cash and sticking your credit/debit cards in the freezer.
Another option is to move the large sum of money into a seperate bank account. My bank has an ‘e-savings’ account that I can’t access with my debit/atm card. I need to physically go to the bank or log in to my online banking and transfer the money out in order to spend it.
When I get paid (every 2 weeks) I transfer out the amount for our bills (mortgage, utilities, loan, etc) into our joint account, then calculate my “allowance” and withdraw that cash, then move everything else into the e-savings. It’s there if I need it, but it’s a little harder to get to and I have to stop and think about it before I move it out and spend it. So far, it’s working!
Post # 7
Thanks everyone, for your input.
I think what we might do is similar to a jar system… we both have paypal accounts with a paypal debit card. I think we might use those cards to put a set amount on the cards weekly or monthly or whatever. I agree it’s easier to spend more with plastic but I have a BAD habit of losing cash. Destination Wedding not so bad, but me, I don’t know why, I mean, I havea wallet but I always seem to drop the green somewhere and not realize until later! Scary.
Post # 8
I’d get your big chunks deposited into a savings account and then give yourself a paycheck each month (or two weeks, whatever you were used to) into your checking account from that. Agree that you will not, for any reason, dip into that savings account. My friend is a writer, so she gets huge advances a few times a year and this is what she does. It works for her a lot better than her old system of feast or famine!
Post # 9
The jar system sounds good. I would also suggest using Mint or some other budget-tracking system– it’s kind of the opposite of a cash system in that it’s easiest to use if you are using debit cards so it automatically inputs your spending. But for me, it’s really helpful to have that super-clear display of exactly where my money went. Maybe a combination of the paypal “jar” system and tracking on Mint?
Post # 10
I wonder if you can attach your Paypal debit cards to Mint.com? That would be a good way to keep track.
I know what you mean about cash, I hate carrying it around.