Financial Hunger Games…we survived month 1

“Congratulations,” Clayton told me last Sat., a huge grin on his face and a fake microphone held to his mouth. “You’ve just survived the first month of Dave’s Financial Peace University. How do you feel?”

Honestly? Not bad. If pressed for a real answer, I’d say pretty empowered.

By far the worst part has been learning to use the Envelope System. Hands down one of the hardest things we’ve had to do in our marriage. And I know at least one of you is rolling your eyes and going, “Gee, how terrible. The hardest thing? Really? Sure sucks to be you…,” but it really was. Remember that part about having 11 years’ worth of financial arguments in 2 weeks? Very stressful times marriage-wise. (Of course I’m not talking anything close to imminent divorce here, guys. Just that it was tough wanting to strangle your partner 28 hours of the day. Let’s not get melodramatic…)

But it’s gotten easier. Every few days we get reacquainted with our bank account, sometimes have a come-to-Jesus with it when things don’t add up, and then fine-tune for next week. Finances have become an almost daily habit for us (in fact, we sit down every 3 days or so to do a quick bank account check up), and if you’d told me, 2 months ago, that I’d not only be balancing our checking account every few days but that I’d be looking forward to doing it, I’d have laughed right in your face. After I punched you, of course. And maybe kicked you while you were down, just for the hell of it.

Because, you guys? It’s working. That was Week 1. Now, at the end of Week 5 (because April was kind of like an unwelcome house guest, hanging on over an extra week because it was “having so much fun!”), we’ve managed to save over $400 on necessities (not even counting the money we allotted for our Emergency Fund) just by paying attention to the freakin’ money.

Yeah, you heard me. $400. And I’m not putting that number online because I want to flaunt it–actually the opposite. I want to empower you guys, if you’re wondering if this system is for you, if you’re in a financial sticky-place and kinda watching this blog to see how we do with it, if you’re starting to feel like saving money is more like herding drunk cats.

The Envelope System (which we learned about from Dave Ramsey’s FPU, but which he isn’t the creator of) is 100% about changing your behavior. And that is Really. Frakkin. Hard. To do. But it’s possible. It’s absolutely, positively possible.

A list of things I’ve wanted to buy and haven’t because I’ve spent my Blow money for the week (since starting the Envelope System):

1. Entry for Tough Mudder in MD Sept. 8-9
2. Move tickets for The Raven
3. Stephen King’s The Wind Through the Keyhole (hardcover)
4. George R.R. Martin’s A Clash of Kings (Kindle)
5. 8 songs off Maroon 5’s album Hands All Over
6. Pre-order of Charlaine Harris’s Deadlocked (Kindle)
7. Movie tickets for The Cabin in the Woods
8. Lunch out this week with an old co-worker
9. Game of Thrones Season 1 on DVD

A list of things I would’ve bought with my debit card this month just because I wanted to (before using the Envelope System):

1. See items 1-9 above.

Those would’ve come out to about $265 over the course of the month, completely for entertainment/whim. And that’s even factoring in the cheap way to get some of them (buying used from Amazon, going to matinees, etc.). That may not be a lot to you, but it ain’t a small amount to me.

So a recap of the month.

Lessons Learned:

• When balancing our checkbook (or spreadsheet, whatevs), don’t just reconcile the current tally with the bank account. Also keep track of how much we’re saving–we keep track of this in our spreadsheet by having a column for the estimated numbers and tallies for the actual numbers spent:

• This serves several purposes: 1) it helps us keep track of where we over-/under-budgeted, so we can properly adjust for the next month so that 2) over the course of several months we can identify trends in our spending, and 3) we get small (sometimes big) motivators when we see that we saved money, even if it’s just a few dollars here or there (because remember, I’m all about the tiny motivators everywhere I can find them).
• Incidentally, I modified our spreadsheet so that it showed a starting monthly balance of $1K partially because it makes the numbers trend easier when it dips, and partially because showing the actual number is TMI even for me. We did some nifty equation-ing in Excel so that the Running Tally columns auto-calculate (because I abhor math). The Saved column is set up similarly so that it it always shows the difference between our estimated spending and what we actually saved (or over-spent, though thankfully that’s been minimal). The Running Tally (Budgeted) column is helpful because we can see where our bank account will be at its highest and (more importantly) its lowest, so we can make sure we have enough to cover our financial butts when bills roll around. The Running Tally (Actual) is what we use when we reconcile against our actual bank account number–the last number in this column should be what’s currently in our bank account.

• Get a partner to balance the budget with. This has been essential since there’re often instances where the numbers don’t seem to add up right. Clayton’s good for catching why the numbers are off (like “Oh, it’s because this bill went through on the 5th instead of the 13th, like we’d planned…”), and I’m (apparently) good at catching the mistakes when our Excel equation-ing isn’t correct (like the row numbers are mis-entered or the + or – in the equation is off).

Where We Thought We’d Fail (and Surprisingly Didn’t):

1. Not taking lunch. This was largely due to our past failures at this because being forgetful is our mortal flaw. However, it turns out that when you’re playing a game with yourself to see how much you can save in a week, you become a lot more motivated to remember things like lunch. Mostly our past issues with this centered around a lack of preparation, so we made sure the night before that we’d have food for tomorrow’s lunch. We made sure we had clean containers for it, and sometimes we packed it the night before (put our Rubbermaid containers of whatever right on the front of the shelf so we’d see it when we opened the fridge in the morning). Having food to take in the house (as in, you plan for  meals and grocery shop so you have the food in the house to prepare) has gone a long way, too, since we can usually whip up something quick if we forgot to prepare it the night before.
2. Not budgeting enough for things. By making minor adjustments every few days, we’ve managed to stay on top of most surprises. We got that $400 I mentioned earlier simply from over-budgeting, which I think is the natural trend when making a budget. You’re like “Ooh, I really don’t want to be caught without gas money later…I’ll add an extra $50 there” and then find out you only end up using $40 in gas anyway. A few dollars here and there really add up over the course of the month, so don’t discount them.
3. Not reconciling the account frequently enough. We’ve discovered, through trial and error, that 3 days is the perfect amount of time to go between Budget Meetings. It’s long enough to let things process (in the spreadsheet pic above, you’ll notice the “P” in the Pending? column to show that a payment has left our hands but hasn’t cleared the bank yet) but short enough that we only have a handful of account actions to have to deal with (so we don’t have 20 different things that went through that we now have to trace back). Doing the budget every 2-3 days usually means we only have to take about 15 min. to do it. Sometimes it’s even been as simple as a 5 min. process, which meant that we sat around for another 10 min. looking at each other doubtfully because we didn’t think it should’ve been that easy.
4. Spending into next week’s Blow money. This has been a challenge but it only took us doing it once to realize that it really sucks and should be avoided at all costs. Sure that $25 thing seems totally worth it this week, but I promise you that next week, when you’re splitting the remaining $5 between two people for 7 days, you’re not going to think it was worth it. Trust me on this–I’ve done the research.
5. “Borrowing” from one envelope to pay back another one. The moral here is to stay inside your envelopes. There’s a reason you’re picking this system up: you overspend in areas you shouldn’t! It’s easy, easy, easy to “borrow” in this fashion, and you should also avoid this one at all costs because it completely circumvents the point of this method. When you run out of money in one envelope, don’t take money out of another, even if you think you’ll “pay it back” from another envelope or from next week’s money. It’s not worth the juggling and this will bite you in the butt. It’s bitten us several times, though thankfully, not hard enough to ruin the week. (Like, this was a butterfly-bandage sort of wound, not a 4-5 stitches sort of thing, but still…it hurt.)

So that’s where we’re sitting a month into it. We’re feeling pretty in control, we’ve surprised ourselves both with how much we were overspending and with our capacity to save money, and we have our sights set on our next financial goal: Baby Step 3, which is to save 6 months’ worth of expenses in the bank. We’re excited about doing this–like, high-five worthy kind of pumped up–and we’re confident that we can do it. Having control over your money, however long it took us to get to this point, is a damn amazing feeling. I highly recommend it.

Reason #650 why my husband is awesome: the Christmas Tree Hierarchy of Driving

My driving makes Clayton nervous. For a long time I got offended about it. I could (and still can) only take so much of his quick “Whoa, whoa, whoawhoawhoa!”-ing or stomping on the imaginary brake on his side of the car or interrupting what I was talking about at the moment with “BRAKES! BRAKES!” He says he does it because he figures I’m so distracted with talking to him, or checking my blind spot, or basking in his beauty that he’s acting as a second pair of eyes on the adventure that is our daily commute. But from my perspective, the only reasons I see for him doing this is because he either 1) doesn’t know how peripheral vision works, or 2) he doesn’t trust my driving. And I know its not the former because he’s a physicist and I know for a fact he had to pass an optics class to get his degree in college.

The latter just pisses me off.

So after one particularly-desperate gasp at our “imminent doom” (read: a lane change), I asked him what his deal was. I was like, “I am going to play psychotherapist, and we are going to work out these second-hand driver issues RIGHT NOW.”

This led us into a wonderfully frivolous conversation on how we perceive our driving abilities vs. those around us and evolved into a discussion on drivers, in general. Jokingly, Clayton outlined to me the internal hierarchy of factors he applied to other drivers, based on “normal” people, sobriety, and finally age as highest-to-lowest levels of driving ability.

Then I was like, “Yeah, so if I’m at the top, why do you freak out so much when I drive?”

With a cute little smirk, he corrected that no, I misunderstood. That pyramid, was actually based on gender. So you had the male versions of those drivers at the top, and underneath all of those, you had the female equivalents. And THAT pyramid was very much organized in decreasing order.

Smelling a blog post in the air, I tried visualizing how that pyramid would look. But when I added in the gender segregation, I realized it was less of a pyramid and more of a Christmas Tree. After much discussion, we came up with Clayton’s Christmas Tree Hierarchy of Driving:

This comprised 96% of our time driving in to work.

And after all that chatter, he finally come to the conclusion that his issue had  nothing to do with his Christmas Tree. His issue was really just being a passenger. In any capacity, regardless of the driver. He just didn’t like the fact that he was putting his life in someone else’s hands.

At this point, I felt like we were on the verge of a breakthrough. So I very gently pointed out to him “You, my sweet angel face, are a control freak.”

Which made us realize the Christmas Tree still wasn’t quite accurate. Hence:

And, lo, Clayton did declare the Christmas Tree Hierarchy to be perfect. And sent disciples into the far reaches of the world to disseminate this information, for the driving edification of all.

P.S. As we were discussing this, literally at the point we realized Clayton was the paradigm of the driving world that should be fanatically followed by all others, I got cut off by a guy in a silver SUV. Now, about two minutes prior to getting cut off, we were coming off an exit ramp from the highway and I kinda squeezed in front of this fellow. Mind you, I did not cut him off…I had my turn signal on. This, as we know, means you are politely informing someone that you’re coming over so they better make room.

But apparently this guy never went to driving school, so he didn’t know—he just thought I cut him off. So he swerved around me, not to avoid a collision (because we weren’t close enough for that risk), but so that he could zoom around me, cut ME off, and then put on his brakes. (Thankfully, I invented that A-hole Zoom Around Move, so I saw it coming and backed off so there was no wreck.)

Instead, as soon as we realized what he did, Clayton and I immediately burst out laughing. Like, big, open-mouthed guffaws of laughter. It was like the ugly cry of laughing. I saw SUV Guy tilt his head up and check his rearview mirror to see our reactions, and apparently he wasn’t happy that we WERE. So he started slowing down. A lot. And Clayton and I were nearly crying with laughter because the irony of it all seemed so very, very hilarious. And that made SUV Guy  angrier.

He turned the corner (because we were all in the turn lane to make a right at an intersection), waited until we’d just cleared the turn and were directly behind him (and couldn’t get out of the way), and slammed on his brakes to make a U-turn right in front of us, in front of on-coming traffic. One big middle-finger of a driving gesture, apparently. Because I was wary of this guy, there was (again) no wreck nor any slamming on of brakes nor gnashing of teeth. At least not ours.

WE were too busy howling with laughter to gnash our teeth. Sure that he made his point, SUV Guy gave us what was probably his best I-Hope-You-Learned-Your-Lesson glare and proceeded to finish making his U-turn so he could go the direction he’d originally intended to and deliberately avoided so he could mess with us. This guy was actually pissed off enough to take three minutes out of his day to try and ruin ours.

Naturally, this meant we had to revise our diagram again:

Clayton gave his permission for all to use this diagram, maybe print it off and tape it to your car’s dashboard in case you need a reminder of where you stand in the pecking order of driving? He also gave permission for you to slightly modify the diagram so that “Guy in the silver SUV” could be replaced with some other, more deserving example of particularly skillful driving. The kind that’s worse than very old or very young women. (Which Clayton kinda contradicts himself by admitting that really isn’t possible, because NOTHING is worse than a really old or really young female driver. Ass.)

Things to avoid saying at the vet’s office

When taking your pets to the vet, whether for routine vaccinations or emergencies, you should realize that there are several things it would be helpful for you not to mention to the vet techs during your visit:

When the vet tech asks you what happened to your dog (b/c you asked them to look at her limp on the phone earlier), don’t get a deer-in-headlights look on your face and stammer, “Uh..she, uh….fell down…the stairs. She’s very clumsy.”

When they show you the toothbrush for brushing your dog’s teeth, do not say, “Oh I don’t need one. My toddler can share hers.”

When they look horrified at your suggestion, do not clarify by adding, “No, it’s ok! My daughter puts nasty stuff in her mouth all the time. Besides, aren’t dogs’ mouths supposed to be cleaner than ours…?” then pause and go “…Wait…or were you worried about my kid giving the dog strange bacteria? Because I don’t like what you’re implying. At worst, my daughter’s only ever eaten cat poop out of the litterbox and it was just that one time! THE DOG REGULARLY CLEANS HER BUTT WITH HER TONGUE, FOR CRYING OUT LOUD.”

When they gently stress that each dog should have their own toothbrush, do not finish their sentence by interrupting with “—because even though they’re roommates, the relationship’s not like that, amIrite?” and then wink at the vet tech.

When the vet tech tries to bring some control to the conversation by relating a humorous anecdote about brushing her own cat’s teeth, do not refer to the toothbrush as being “of the feline persuasion.”

When going over the list of expenses do not use the phrase “less-lethal,” as in “We didn’t really budget for a vet bill this expensive this month. So which of the issues we discussed earlier are less-lethal? We’d like to take off the treatment for those and see what our total is.”

When the vet tech croons over the way your simple dog quivers with fear at existing in a place that is not her home and being looked at by eyes and seeing things she’s only seen 200 times before, do not try to compensate to the vet tech for the obvious rejection your simple dog is giving her by saying, “Don’t take it personally. She’s emotionally retarded.”

When you’re paying the bill, don’t muse that “You know how they say that if a car repair is going to cost you more than the car is worth, it’s better to buy a new car? I’ll bet we could buy a lot of dogs with $400…”

Saying any one of these things will both  make the vet tech incredibly uncomfortable (especially if she’s new) and will make you look weird (though, that’s really nothing new for me).

All but 1 of these popped out of my mouth within the hour-long visit that I had this morning. And of course I was kidding. Especially with that part about Rynn eating cat poop. (She actually prefers clumps of dog hair she finds under the edges of the cabinets.) That last one actually came from Clayton, after I recounted our bill. And yeah, I know…I told him it wasn’t funny either.

Random lunch-date conversation (that just happened to occur at McDonald’s) ….(sorry, that seemed important, for some reason)

So, we’re talking about Brazil because some little boy sitting across from us had a unibrow that reminded me of Rodrigo Pessoa. And Clayton gives me this blank look when I say the name b/c I’m the horse person, not him. Which really means that this whole ensuing conversation is really his fault.

Me: He’s a famous showjumper from Brazil whose unibrow should’ve had its own Facebook page. Come to think of it, a lot of famous equestrians were Brazilian. So I guess Brazil’s kind of known for it.

Him: *gives me a funny look* Er…say that last part again…?

Me: Brazil’s known for its equestrians. Oh, ok and maybe its martial arts. So horseback riding and ass-kicking.

Him: ……..

Me: You know, Brazilian Ju Jitsu? If they named a style after your entire country, you can kinda assume you’re a badass in that field.

Him: THOSE are the things you think Brazil’s known for? NOTHING ELSE?

Me: Um…there’s something else isn’t there?

Him: Uh-huh.

Me: …I dunno. Some kind of Macadamia nut, maybe? Are they famous for their nuts?

Him: I was thinking more like SOCCER.

Me: Who knows Brazil for their soccer players? I’ve never even heard of one.

Him: Ever heard of a guy called Pelé?

Me: He was Brazilian? I thought he was from Mexico…

Him: Oh, honey. …You’re so pretty.*

I’m still not convinced he’s right, but I might defer to him about a sport I’m obviously ignorant of. Not that I’ll admit that to him.

* This was borrowed from another friend’s inside joke, wherein she has a friend who always uses that line when he encounters women who say stupid things. It’s his way of ending a ridiculous conversation that he can’t believe he got tricked into having. Usually the women saying these things are vapid enough that they immediately drop the silly line of reasoning they had and focus on the compliment, completely ignorant of the dig. Apparently it’s not common for them to question the abrupt nature of the compliment, either, which wraps the whole situation up in a pretty bow of irony, if you ask me. It’s now an inside joke for us, too, b/c we don’t mean it meanly, but I got the point and promptly changed the subject to something intellectual. Like the cruise we’re taking in July. Because I’m becoming an expert at that.

UPDATE: So, Clayton wants me to print a retraction because he apparently didn’t actually tell me “you’re so pretty” when I was being Brazi-gnorant. Apparently I just heard this in my head. Which is an entirely different set of problems altogether. He also wanted me to make sure everyone knew that unlike the friend-of-a-friend, who makes that comment as secret digs, he and I say it to each other as a joke. Because to us, it’s a really funny way to respond to someone being foolish. Or Brazi-gnorant. ALSO, my friend Kristy reminded me that Brazil also boasts high incidences of a certain style of genital mutilation bikini waxes and infanticide, which means that Brazil is damn lucky to be able to claim Rodrigo Pessoa as one of its most redeeming features. Oh, and that rain forest thingy…

Starting the Envelope System

In an earlier post, I mentioned that we’d started Dave Ramsey’s Financial Peace University and had survived the first 3 weeks (read about them here to catch up). I ended with a promise to tell you the moment I fully came on board with this system. It was the moment I saw the number $133.

But first, some insight into how we set up our Envelope System. Most of our bills are auto-debited online–all of the necessities that come out at the same time each month, so we know we can plan for those with a fair amount of reliability. We have 3 envelopes: Gas, Groceries, and Blow (because you’ve got to budget for your drug habit). HAHA! Just kidding. (It’s actually Rynn’s blow habit. The dependency’s what keeps her so well-behaved.)

We use the envelopes that came with the FPU course materials, but I imagine you could very easily make your own with some normal envelopes, a pen and a ruler, and a binder to stick ‘em all in. On the envelopes, we keep a running tally of how much cash is added to the envelope and how much is taken out:

(Note, others going through the FPU course with us are doing this in 2-week increments, but both Clayton and I know my attention span’s only good for about a week at a time–past that, it’s hard for me to stay motivated. So we do ours in weekly increments.)

The breakdown of it:

For each line item in your budget that you can use cash for, you take an envelope and write the category name at the top. At the first of the month, we withdraw the amount we budgeted for that category. Mark where the first of the money came from (“Paycheck”) and then subtract as you withdraw the money, using a “-[number]” to show the money’s leaving. Because I’m all about the visual aids. Write down how much you removed when you do it, otherwise I promise, as true as the fact that tacos are delicious you’ll forget to later. We tuck a pen in the spine of ours just so we don’t have any excuse not to (“but the pen is all the way in the office, and I don’t feel like walking 20 extra feet. Do you know how many feet I’ve walked today? I’m tired just thinking about it.”)

If you have any money left over–like you took out a $20 for groceries but only ended up spending $15–you put the leftover back in the envelope when you get home and immediately write it down–put a “+[number]” every time you put money back in the envelope. You’ll notice that even though we kept track of the exact amounts on the envelope, we only put the bills back in–the spare change we put in a change jar. So, for that first withdrawal we made for the Wegmans shopping trip, even though our balance is listed as “$115.90,” there was only $115 in the envelope. Our reasoning for this is, 1) our change jar has a digital counter in the lid, so it gives you a running total of what’s in your jar (because counting’s hard), 2) it’s not like it’s loose change strewn about on every countertop in the house, so we know exactly where to go if we need change later and 3) it keeps us from bulking up our thin envelope with twenty nickels and seventy-five dimes by the end of the month.

Because I’m anal-retentive when it comes to organizing lists, I have to put something in Every. Single. Cell in a table like this. You may not feel the need to note that the extra $5 you’re returning to the envelope after grocery shopping came from “leftover.”

The idea is that, as you get better at budgeting, you’ll be able to fine-tune your cash envelope amounts so that there’s not much left over–ideally, you’d end up with an empty envelope some time very near the end of your week/2 weeks/month, and then just start over the  next week/month/etc. (You don’t just spend the money ’til it’s gone and then immediately refill it–know how long that money’s supposed to last and then resist all temptation to refill it before you’re supposed to!) At the end of the first week, you can see that we had $53.73 left over. (So we can reuse the envelope until we run out of lines, I put dash markers in the margins to indicate when one week ended and another started. Again, because I’m a List Nazi.) We chose to put any extra money at the end of each week in a fourth envelope: “To Deposit.” After some debate, we decided to go this route for a couple of reasons:

1. I am easily influenced. This means that I am both easy to encourage and easy to discourage. To promote the former, the “To Deposit” envelope serves as a visual reminder to me how much money we’re saving. I see a number balance rise every time we have “leftover” money, and it gives me further reinforcement that “eet’s working, boss!”
2. It saves us from having to make several trips to the bank throughout the month just to deposit back what was leftover. I’d feel pretty silly going to the bank to deposit $3.21, just because we didn’t spend all our Blow money that week. Also, we’re both really forgetful, so the money would probably sit in a deposit envelope ANYWAY while we kept forgetting to take it with us in the morning. Then we’d forget it on the table for several days. Then we’d get it in the car, but forget to go to the bank that day, so it’d sit in there for another week and a half while we kept forgetting. Then it’d either get lost, money would fall out, or we’d finally deposit it sometime around the end of the month anyhow. (So the “To Deposit” envelope is us working with our weaknesses in mind.)
3. We did consider the option of rolling the money over into the next week’s budget, and I think this might be an option for people who’re stronger with numbers than I am. Even though Clayton wouldn’t have had a problem doing this, I am very simple-minded when it comes to numbers–in my head, I have to have things in a very clearly-marked mental bucket. So playing the simple game of “we had $5 left over, so we’ll just move that $5 bill into next week and just withdraw $5 less from the bank” is actually really hard for me to keep track of. I don’t know WHY my brain starts throwing a 404 error when I try to math that through, but it does. I work best with a wipe-the-slate-clean approach, so Clayton, to be nice, goes along with this Organizing to the Weakest Link approach. The numbers all work out in the end whether you do it our way or this way, though, so it’s up to you.

To give you insight into the others, this is what our Gas envelope looks like:

and our Blow envelope:

A few notes on the Blow (or Entertainment or whatever you want to call it):

In our budget, our Blow money is approached as a “what can we spare this month” amount, so it’s not as fixed an amount as the other two (for example, Week 1 we had $80 to throw around, but when an unexpected-but-non-essential fee came up, we chose to take it out of Blow, only leaving us $30 for Week 2). When we have that one number, we (of course) have to split it between the two of us, and the fairest way we do this is to split it in half. Then we agreed that if one overspends their Blow portion, it’s ok to see if they can take from the other’s (for ex., if I want to buy lunch out one afternoon but have spent all my Blow money, Clayton’d be ok with giving me however much I need when I ask). The most important aspect of this is to 1) keep communication open, and 2) to not make judgement on the other’s Blow purchases unless it seems to be abusing the system (like I regularly kept coming to him for more Blow money–that may mean I either need to adjust my spending habits or we need to reconsider the amount we budgeted for Blow).

Now, I can’t speak for Clayton on this, but I know I’ve struggled with the mental concept of this. The idea of Blow is that it doesn’t matter what you buy–if I want to spend my $40 or whatever entirely on rubber ducks, then it’s “my money = my ducks.” But I don’t want to take advantage of it by running through my amount and having to take some of Clayton’s. But I know that having the “mine/his” attitude about shared resources is a bad, bad idea in a marriage–it can lead to resentment and fear. And as we all know, fear leads to anger, anger leads to hate, and hate leads to suffering.

That’s right: having too much ownership in a marriage leads to the Dark Side. An that’s some bad, bad juju right there.

Anyway. I worry over making sure I spend “my” amount of Blow carefully so that I don’t find myself wanting to pinch off Clayton’s. And this approach has actually led me to be VERY sparing in how much of my money I spend. Putting out my own cash hurts more than swiping my card, so I tend to horde it…EXACTLY AS DAVE RAMSEY WANTED ME TO.

Clever bastard might actually be on to something.

But, I’ve rambled this much and almost forgot about that number I mentioned up top. Remember that $133 I talked about? The number that got me on board with this whole program? It came from this:

BOOM! $133 saved in a week because we were actually careful, for once, about what we spent. And while that may not be a huge amount, it is a non-trivial amount for me, esp. in a week’s time. This is what showed me that we were on the right track, that if we stuck to this plan, it WAS possible to save money. When we set up that envelope, I’d expected to be moving over something like $10, maybe $30 at the most.

And since I totaled up the leftover bills from each envelope and lovingly wrote that 1 followed by a couple of 3s, it all became a game for me. How much can we save in a week? Can we top the first week’s amount? Where can I cut corners in my spending? Using coupons at the grocery store (when I haven’t before)? Taking my lunch every day for the week, instead of going out for an afternoon? $8 here? $2 there? It’s kinda fun and numbers don’t seem quite so intimidating to me anymore.

Since I got some positive feedback that at least some of you care about our process and progress here, I’ve got another question for you. Would any of you be interested in budgeting, or in hearing about the things we’ve learned/the spreadsheets we use to keep track of and plan our budget? Let me know–if not, no worries. If so, I’ll see what I can scare up and pretend is something intelligent.

P.S. Let me make very clear that I didn’t post our actual budget amounts because I’m inviting your opinion on how stupid you think Dave Ramsey or this system is (thinking it’s unrealistic is different, and I’ve got no problem chatting with you about it. Come on over–I’ll put on some tea.). To be very blunt, I don’t care. Nor do I particularly care for unsolicited advice on how to spend our money, whether you think $80 bucks a week is too much for Blow money, etc. (Though I’ve got no problem telling you how we came to that number, if you’re interested.) I’m putting this out there in case any others of you are in a financial hole or simply feel like you could be taking more charge of your finances and might be wondering what others are doing to get themselves out of said hole or to make their money behave like they want it to.

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Carry on.

Reason #7,564 why my husband is awesome

Señor Hubbypants recently asked if I would mind him attending a week-long MIT course on radar in Boston (’cause as much as feminists want to claim that it’s patriarchal for women to “submit” to men, in a good marriage both submit to each other in a give-and-take kinda fashion–and nobody’s going to stand up and say “How dare that woman subjugate that man in that way! The man is asking permission?! How demeaning!” Seems kinda silly when you turn the gender around, huh? Feminists, in these instances, stop being selfish and realize that it’s not just about you All. The Damn. Time.).

*blushes* Sorry. Soapbox.

Anyway.

So he sends me this email asking if he can go, and in the email, he includes the link to the course. Which I found endlessly amusing, as if being able to read about the course would make a difference in whether or not I’d want him to be gone for a week. Like, maybe he thinks I wouldn’t believe him? Or maybe he thought that at first I’d be like, “Hmm, not so sure about that,” but then I’d click the link and read about it and then go, “Well…they DO get to have a radar imaging competition at the end,” and THAT’S what would finally win me over…?

I found that charming. So very, very charming.

So I made up a quick graphic and emailed it back as my response:

His response? “Whatever, woman.”

This man: he pleases me. I think I’ll keep him.

Giving my money the BDSM workover (a.k.a. starting Financial Peace University)‏

This may be more boring than my past posts, but instead of just talking to hear myself think, this time I actually want to chronicle something that we’re doing so I can look back after we’ve finished and see what the $*@% I was thinking. And since we started this little epic about 3 weeks ago, this post is a shade late. Sorry.

About three weeks ago, our Bible study decided to host a 13-week course on finances called Dave Ramsey’s Financial Peace University. Clayton and I have been familiar with Dave Ramsey for a while–as I’m sure most people would be at least a little interested in a guy who first became a millionaire at age 26, lost it all so bad he filed for bankruptcy (when the bank called in his debts all at once), and then made it all back again.

I’m going to hold on while you read that last part again. That’s right: he became a millionaire twice in his life, through God’s blessing and his own hard work. So if I’m wanting to build up my bank account so my family is more comfortable, and this guy walks down the street and says, “Let’s chat about money,” you’d better believe I’m going to listen to what he has to say.

Anyway.

So we’ve been doing the video coursework for FPU, but it wasn’t until Week 3 that Clayton and I finally tried the Envelope System Dave recommends using. Basically, the idea is that you make a balanced budget (you start with your income that month as a starter number, then subtract your expenses–including tithing/giving, savings, etc.–until your end number is back to zero), and then pay with cash for certain items, like most retail purchases. The idea is, when the money runs out, you stop spending in that category. Boom. Instant way to keep to your budget.

I was REALLY doubtful about this. Like, pick-a-fight-every-time-we-try-to-do-the-budget kind of doubtful. It wasn’t that I wasn’t fully committed to doing it–it’s that I was more “committed to doing it until it got hard.” Which is kinda the story of my life. And since it involves numbers, budgeting is automatically on my It’s Too Hard List. I wanted to do it, I knew we needed to do it, but I also wanted it to be fairly easy reasonable.

I didn’t want to feel like the budget was a paper straitjacket.

I didn’t want to look at numbers every night.

I didn’t want to have to go online and compare our purchases with what we actually spent that day/week.

I DID want to save money, though.

I DID want us to pay off our mortgage early, like we’d always talked about doing.

I DID want Rynn to have a pony and learn to ride while she was still kid enough to be kid-reckless on it.

But these didn’t/did wants didn’t really add up. Our situation for all of our married life, up until a week ago, had more or less been to buy the stuff we wanted when we wanted to, without much regard for where our bank account was. Sure, we’d look at it once a month or so, to make sure we knew the general ballpark figure. But we didn’t really save up for purchases. We’d say we were going to save up, and then a month later we’d go buy it. Pretty haphazard, really. We weren’t completely ignorant of our money, but we were ignorant of where all of it was going.

Prime example: we discovered, when we’d sit down to make up a budget we never ended up following, that we had $1,200 left over that was essentially unaccounted for after we knocked off all the necessities. Then we’d look at each other quizzically and go “Why wasn’t that put in savings? Where did that much money go?” and then we’d look at our purchase history and see “Chilis,” “Akasaka Hibachi Grill,” “Logan’s,” “[whatever the name is of the little Mexican restaurant up the street].” Then we’d go “WOW. We LITERALLY ate $1,200 this month. That’s ridiculous!” Then we’d vow to eat at home more, follow that for a week, and then forget the resolution for another month.

On and off for the first two weeks, we fought about money a lot. For a couple that rarely has major fights in general, fighting almost daily about the same damn thing got old by about the second argument. He’d be like, “I thought we both agreed to do this,” and I’d be like, “Well sure. As long as we do it tomorrow.” And then we’d fight like two wet cats thrown in a box, because he thought I was dodging it and I was just trying to set an alternate date. Then I’d complain about a headache because I’m allergic to numbers. We’ve been together for 11 years, and I think we actually had all 11 years’ worth of financial arguments in those first few weeks trying to get the budget in order and both of us on board. It wasn’t pretty. We were great, until Clayton mentioned the need to sit down and look over the b-word. And then I’d turn into a massive other b-word and we’d have a colossal fight complete with hand grenades and mustard gas. Like I said…not pretty. And for about 2 weeks, I was convinced that Dave Ramsey was an idiot. I finally told Clayton, “He said this would PREVENT fights about money. We never used to fight about it before.”  And my oh-so-very-astute husband answered, “Well…yeah, of course not. It’s hard to fight about something you never pay attention to.”

Ouch. Good point.

So, recap of Week 1:

Week 1 was about understanding the basics. Dave’s system is largely focused on you getting rid of your consumer debt and staying that way to amass wealth. One of his videos quotes a statistic first published in a Forbes 400 survey: 75% of those rich folks polled said that #1 way to get rich was to stay out of debt (as a side note, remember that the Forbes 400 consists of millionaires and richer). And since this advice is coming from not just one wealthy guy, but 300 of them? Yeah, I’ll listen to that.

Dave Ramsey’s system follows these Baby Steps:

1. Put away $1,000 to start an emergency fund.
2. Pay off all your debt using his Debt Snowball approach.
3. Save 3-6 months worth of expenses.
4. Invest for retirement (15% of household income in Roth IRAs and pre-tax retirement).
5. Start a college fund for your kid(s).
6. Pay off your mortgage early.
7. Build wealth and give.

During Week 2, we took the first stab at a “quickie” budget to get an idea of what our necessities are. Then, in Week 3, we made a full budget that encompassed all the necessities, plus the other things we spend money on. We followed his guidance on what to include (for example, not just what you spend money on but also when these things are due), and Clayton took several hours over the course of a weekend and went through the tedious process of setting up a concrete budget–if anybody’s interested, I can make another post on all the work that went into it b/c it actually was a serious effort. But the ground work he put down to get the numbers in order have really paid off when we go to mess with it now.

And, honestly, I still wasn’t on board–or, I thought I was but, looking back, was still on board as long as Clayton did most of the work. But I finally agreed to shut up and do it, since I had, after all, originally agreed to do it…back when I was excited about it and didn’t know what I was getting into.

Then we started the Envelope System, and I got a massive reality check at the end of week 1 when I saw how much we’d saved. I’ll detail that moment I went from being an interested video watcher into a 100% ON-BOARD advocate in my next post or so. Right now I’ve written this at a time that is WAY past my bedtime and I’m tired of my Sorcha-kitty drooling on my wrist from where she’s curled up next to me. (Yeah, she’s a drooler and it is massively icky.)

What’s your take on finances, Most Highly Respected Anonymous Readers? Are you even interested in hearing about the fascinating world of my finances? Have you been in a situation before where you thought your financial system needed to change, but weren’t sure where to begin?