I have so much I want to share that I'm finding it difficult to know where to start! Maybe the best place is at the beginning.
I have always enjoyed what I thought was budgeting. From our early years of marriage I kept a book detailing explicitly what we spent our money on, and making beautiful coloured lists that showed how much we were spending in every area of our finances. At work, I looked forward to the first day of the new month, when the bank statements would come in and I would have to spend a day or two reconciling them. I loved that feeling that I had made it work. It was a finite task, and had a huge sense of fulfillment attached to it for me. Unfortunately... my idea of budgeting was somewhat skewed. Although I
knew where and how we were spending our money, I took no action what-so-ever to make a plan to pay off our debt early, and I found that although we were on a great combined wage, we simply didn't have any savings. We lived pay-cheque to pay-cheque - never worrying about money, but spending everything we earnt. We weren't frugal, but neither were we stingy in sharing our finances. We enjoyed being able to share our money with others who needed help, and gave in various ways. This has always been a huge part of our family philosphy - to share what we have, and be generous in our giving. I believe what goes around comes around, and I find it a joy to be able to bless someone else in our sharing.
After reading Dave Ramsey's blog, and then getting his book, I was so mortified about how much we had
wasted over the past 20 years. We could quite easily have been debt free by now if we had simply had a plan in place. So now, we have a plan. We are in the process of getting rid of our credit cards. Yes. All of our credit cards. BUT... I hear you saying, "what about the credit card rewards you get", and "we always pay off our credit cards each month in full".
Yeah right! I also said this - we ALMOST always paid off our credit card in full each month, but there sometimes came a month where we didn't quite have the full amount needed, so we were plunged into a horrible cycle of interest payments and scavaging around, robbing Peter to pay Paul, so that we wouldn't have interest to pay next month. We put everything possible on our credit cards, so that we would get the 55 days free interest, and the money would stay in our revolving credit account, hence letting us pay less interest there. Simple stuff. When it works.
Once I had read through the information available on the net about credit cards, and had been really honest with myself about our credit cards, I found that it was just too easy to pull out a card and pay for anything. I didn't actually perceive it as money, just a convenient way to take stuff home. And I loved getting the rewards.
But, when I looked at how much I had to spend in order to get a reward, it was really pitiful. I just redeemed my last reward before cutting up my credit card. I had spent $10000 on a bank credit card to receive a $50 petrol voucher. Sad. When you also consider the account fee of $100 per year, plus additional card-holder fee, etc, etc, then I would be lucky to actually be making on the deal. So there they go.
We now use cash. Yes, folding notes and coins. Really!! I do feel really great when I hand over a lot of cash to pay for our groceries, rather than using a card. I'll talk more about the envelope system we use for our cash purchases another day, but can I just say that it is so easy to stick to a budget this way. When the grocery envelope is empty, it is empty. I can easily see how much is left, and warn the rest of the family that I won't be shopping again this month. That always gets some great remarks!
So - there's the start of all this. I'll be adding recipes for food or cleaning products that I have found work really well each day, plus other tips to help get you on track.
Please feel free to ask me anything - I'd love to think that I am able to help just one person to be inspired to start saving, or spending less, or just think about doing a budget.
In the meantime...
Happy Savin!
