I'm sure by now everyone has heard of Dave Ramsey. Last year for Christmas my husband received Dave Ramsey's book "Financial Peace". Within the first month of reading his book Brandon had me on a very strict budget. I must say at times I would get so frustrated being on this budget because I no longer had the freedom to spend my money on whatever I wanted (not needed). I never realized how much money I was spending on things that didn't matter at all. So now here we are, one year later and the debt snowball is gone! I am proud to say that we are now debt free!!!
I recommend this book to anyone who wants to free themselves of debt. It takes a lot of discipline but the contentment in the end is worth it!
Q: My wife thinks it's no holes barred when it comes to buying the presents for the kids. But money is tight this year and I don't see a reason to go into debt. How do we resolve this?
A: In most marriages, there is one who spends somewhat more and one who spends less. In lots of relationships, both tend to spend too much or both are tight with money. Sometimes each partner thinks the other is spending too much, but that's because each would spend more money on something different from the other. I mention all that because I think it's extra tricky when it's "for the kids." Most people who go overboard in spending will find it especially easy to do when it seems so justified. It's for the children, after all. So, this is tough and it's tough for a lot of couples.
There are a lot of times and places in life where a simple budget is much easier said than done. This is one of those areas where a simple budget has a pretty good chance of working if you both commit strongly to it. The key is planning together at a time when it's not in the middle of a potential "spending incident." Deciding what you are going to do about this, together, won't happen well out in the stores. Best to sit down and get this decided well before that time.
Here is a very specific plan. You could talk and modify it to your liking as a couple, or maybe even talk and just agree to it if it really seems to work for you both.
1. Sit down and talk.
2. Agree to a total amount you can truly afford to spend. If your spouse thinks it's higher than you think, bend a little. You'll be way ahead if you stick to a limit, even if it's a bit higher than one of you think is affordable. I said "a bit" though, not "a lot."
3. Divide that total amount by the number of children. Seems simple, I know, but if you set a hard limit in some way like this, you'll be less prone to play favorites with one that means you have to overspend to catch the other(s) up.
4. Once you have the amount, use an envelope system. Put the amount for each child in an envelop for each child. Cash. When it's gone, it's gone, and you both commit not to go over, no matter what. That will mean you have to stay under the amount, and likely have a few bucks for each child left-over to give to each child in the envelopes. Explain that some had a few more left over because their gifts cost a bit less.
5. Agree to do all the shopping together. Okay, some of you really will groan on that one, but I'm suggesting you make this a real, total, team thing. Make the choices together and stick to the plan.
There's a lot that can go wrong with even a simple plan, but if you both truly agree with a plan like this, you can avoid a lot of pain, anger, and, seriously, debt.
So, today is my 5th anniversary with my wife. Anniversaries are always tricky. Traditionally speaking, I should be giving her a gift of wood today; but, I’ve never been the traditional type. We recently bought our first house, so the budget has been pretty tight lately and figuring out the new budget has been interesting. So, since I’m a graphic designer, I have been designing a poster for her for a while now and I had it printed at a local FedEx-Kinkos last night for a mere, budget-friendly $3. Throughout the course of our relationship, I have “made” several gifts for her to save some cash: there was the scrap book of fun photos and notes from our first year together back in college; there was a large collage print made of magazine cut-outs; then, more recently, a cartoon flip book of dinosaurs (her and I) falling in love. Even if you’re not a graphic designer, there are thousands of ways out there that you can show you care by being creative on a budget. What are some small ways that you’ve shown big love to someone in your life?
In this video, Drs. Les and Leslie Parrott talk about how couples can work together to effectively budget their finances.
This video talks about different ways couples can work together to save money.
In this video, Drs. Les and Leslie Parrott give advice on surviving a career crisis.
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