theholtsite

I enjoy being transparent with finances in the hope that it will help others improve their own decisions and marriages. Responsible money management is a passion of mine I like to share.

During the early years of our marriage, we had many disagreements/fights about money – like Jill wanting something and me being like “you don’t need that” and vice versa. We developed this system years ago, and almost never get in fights over money. Here’s how it works:

 

1) Keep track of all expenses and income. Every time you buy something, write it down somewhere. This is hard but important.

2) At the end of the month, sit down and do some calculations! This is more exciting than you think – Jill and I love this time of the month.

3) Take all your money earned this month and:
* Subtract GIVING percentage (ours is currently 10%)
* Subtract SAVING percentage (ours is currently 20%)

The percentages are adjustable depending on what you agree on or what your goals are. Make them as high as you can 🙂

4) Subtract all expenses from the month from whatever is left

5) If there’s any $ left over, this is your personal spending money! If you are married, split this in half. This becomes your “own” personal money for hobbies, presents, travel, etc. It can be kept separately and carries over each month!

 

Why does this work so well?

– Both Jill and I have a vested interest in keeping our expenses DOWN. The less expenses we have, the more budget money we get for ourselves at the end of the month!

– We get to be generous AND save responsibly! We do not get extra personal money unless we have given and saved enough “off the top”.

– We don’t fight about money because things are done fairly, or “by the book”. If Jill wants something and has the budget money for it, she just buys it, and I don’t have to worry about it. I know I have the same amount and that our family is taken care of. By the same token, I can buy whatever I want with my budget money too!

What are the cons?

– It takes a lot of discipline to keep track of everything you buy and earn. It’s even harder if you’re married because BOTH of you have to keep track.

– It can be hard to agree on what is a necessary “family” expense or a “personal” budget expense. Usually it’s fairly obvious to us, but sometimes not.

– It’s hard to not get any “personal” money if you’re doing poorly financially (and spent it all from previous months). Jill and I have learned to keep a buffer to tide us over!

 

If you end up using this, or a modified version of it, let us know. We’d love to know that sharing our system helped someone out!