~ Luke 14:28
My friend Lindsay, and fellow Motley Mom, let me borrow a few of her Dave Ramsey books before I left Florida. Her family follows Dave's plan to be debt free, and I was so excited to learn more. Dave gives readers baby steps to become debt free, and I am so drawn to him because he is a Christian.
One of the first things I learned from Lindsay and Dave is to pay cash for everything excluding monthly bills. Before, I always used my check card for any and every purchase: McDonald's sausage and egg McMuffin - $2.58, Starbucks tall decaf peppermint mocha - $3.85, GNO at movies - $8.75. Ironically, I was also always afraid to check my bank balance online. I dreaded writing down all of the deductions and I lived in constant fear that an expenditure was forgotten. Spending like this also enabled me to be blissfully unaware of how much we actually spent each month at Starbucks, the grocery store and even on gas.
I do have to spend some time each month budgeting how our money left after paying bills should be spent, but I am so thankful to have money left after paying bills! Grocery shopping has been the biggest challenge for me. I budget $50 per week, which is a challenge alone. Paying cash forces me to keep a total of how much is in my cart, and I forces me to make some tough decisions like, "Do I really want to spend $4.00 on 2 pounds of boneless skinless chicken breasts or would I rather get 4 pounds of split breasts for $4.00?"
Paying with cash is a great way to start tracking your spending. I use an envelope like this, filled with smaller envelopes.
My categories are: fun and farmers market, babysitter, hair care, toiletries, clothing, Walgreen's, prescriptions, co-pays, gas and oil, repairs and tires, groceries, cleaning, entertainment, Starbucks and restaurants. I am planning to add an emergencies envelope to have a few extra dollars for things forgotten or unplanned, like school fundraisers.
Like most new years, I am hoping this year will bring our family more prosperity, but this year, I actually have a plan to make that happen. What money saving goals or tips do you have for the new year?