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My Envelope Budget
- From Leigh�
Here is the way I budget
our money to stay out of debt. It's not easy, I admit,
but it works if you stick to it. Although I am not one to throw money away, I
still spent more than I should and found it harder and
harder to save. So, I put myself on a budget. My husband
gets paid at the first of the month. He pays the house
note, house insurance, his auto note, auto insurance, my
health insurance (his is provided) and utilities. After
that, there is little left. I decided I had to be very
wise with my money to get us through each month.�
Make a
list of every possible, but reasonable need for money
you have. My categories included Car Payment, Car
Insurance, Student Loan Payment, Savings/Mutual Fund,
Home Improvements, Gas and Oil Changes, Food and
Entertainment, Groceries, Medical Expenses (including
medicine, check ups and eye care),Christmas and birthday
gifts, Vacation, Internet fees, bank fees, and Misc. I
then took my car payment note and divided by four. This
is the amount that I must pay to my envelope each week
to pay my car note at the end of the month.�
Then, I did
the same with my car insurance, student loan, gas and
oil changes (est. gas bill), groceries (We limit $20.00
weekly and easily stick to it for the 2 of us), Medical
(we spend approx. $30.00 per month on medicine, but I
add about $5.00 more each week for check-ups), Internet
cost, and my $4.00 bank fee. These are bills that must
be paid. I add all of those numbers up and subtract that
number from my weekly check. Then, with what is left, I
divided among savings/mutual fund, entertainment and
food out, Christmas & birthday gifts, vacation, and
misc.�
To begin with you might not have the luxury of an
entertainment fund or a vacation fund, but if you stick
to this, you eventually will. Might I suggest that you
have a savings fund before a vacation fund. After a
while you might can save $5.00 per week for a vacation
fund. It might not be much, but it could be a weekend
get-a-way in a year's time. The main thing is: Stick to
your goals! Do not take from one envelope for this or
that. This can work for you and won't you be happier
with $100.00 in your savings account than you would be
with the new outfit that you don't need? This is a good
way to budget your money and not feel deprived!�
Good
Luck!� (From Leigh)
We
Don't Use Credit Cards - Simone B from Cinti,
OH
I read your portion of The
Frugal Life ezine, and couldn't agree with you more!!�
I wanted to ask why our high school aren't focusing
more on teaching our young folks about debt to begin
with?� There used to be a class for that when I
was in school, and it was so impacting that I have
never ever accumulated any debt at all.� Every
car I've ever owned I paid cash for, I've never had a
credit card in my name nor any other loan (save
student loans, which I began to pay as soon as I took
them out, and so they were nearly paid off when I
graduated the four year program).� We pay all our
bills on time and often ahead, save some every month
(not as much as we should I'm sure).
Our first home we
purchased based on price/options/deal, and location
for schools, nothing else entered into the
decision...we found a home that was being sold to
satisfy a divorce decree.� We paid it off in 9
years, sold it a year later for not quite twice what
we'd paid, and haven't had a mortgage since, AND have
managed to move into bigger and better homes each move
without any debt attached.� We are both late-30s
and began the process in our early 20s.�
The big reason we don't
save more is because we are pre-paying college credit
tuition for our three children (as well as paying for
private schools now, which would not have been an
option with a mortgage).� We live in Ohio, and
you can buy credits (useable at any public institution
in the state) at today's prices and bank them for
later use - they do not expire and are refundable at
the rate paid should they chose to attend out of state
or a private college.� It's a little bit of a
gamble because we would not have made any interest
should they go to another school, but at least they
will have a chunk of money to start with, and I'm
betting against them making that choice.� In with
that bet is the fact that tuition has been climbing
faster than interest rates, and so while we pay $125
for each credit hour (undergrad) now, the rate at
which tuition is increasing (and predicted to
increase), they will be attending at a time when
tuition per credit hour will likely be about $200 for
our oldest child, and estimates indicate about $260
for our youngest.� In my opinion that's a nice
bang for my bucks.
�
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