003: Finances: Budgeting
Show Outline
1. Stay organized financially
2. Philosophies
3. Budgeting Tools
Family Finances Beginnings
Started out just trying not to spend more than we earned.
Didn’t help plan for future.
Philosophies
Live month to month or get ahead.
Found a program called You Need A Budget that helps set aside money for big bills that come every year, as well as build up savings.
Helps prepare for big expense times like Christmas, school dues…
Budgeting Tools
Started with Quicken, which tracked where money was spent. Good to start off with.
Different types of budgeting tools, ones for free, one time fee, monthly fee.
Free programs:
Tried Mint but only told where money was spent. It has probably improved since we tried it 15-20 years ago.
Spreadsheets like GoogleDocs or even homemade excel spreadhseets work for some people.
GnuCash works in Windows, Linux based, and Mac computers.
One Time License Fee Programs:
Microsoft Money was mentioned but apparently it has been disconintued.
Monthly Subscriptions:
Mvelope although the basic program is free, could pay $9.95/month for the premier package.
Deseret News printed an article in 2014 comparing the Mint, YNAB, Mvelopes and Check budgeting tools pointing out the pros, cons and costs of each as well as pointing out who that program works best for.
Organized Family Finances
There are different philosophies and purposes with each program.
Find a program that you can keep up with and fits your style, and then be consistent with it.
Some programs download all the expenses from your bank into your budget so you don’t have to type in every expense.
Monthly meeting idea came from Dave Ramsey’s Financial Peace University. He suggests discussing and making necessary money changes each month to your budget. But both members of family budget committee needs to agree on money numbers, not just one person.
Make sure you set aside money for savings, charity and bills.
Plan for future big bills, pay down debts.
Dave Ramsey, Simple Dollar and YNAB philosophies all say pay off debts.
We’ve taken concepts from several budgeting principles and applied to our own budget.
Pay bills right when you get them helps keep finances organized. It works because money is already earmarked for that bill.
Takes awhile before categories are set in place with the money needed for each bill. You don’t have to wait for the next paycheck in order to cover that bill.
Paying bills routine:
When bill comes in the mail, pay it right away. Write down the date it was paid, web confirmation number if paid online, then file it.
Filing bills:
Take a manila file folder and staple 6-12 papers onto it and label one month per page. We used to fit all 12 months in one file folder, but now split it into 6 months per file folder. Label year and months on the file tab.
When looking for a past bill, open file labeled that year, go to paper with that month, and find bill stapled to that month.
Budget programs are handy when searching for a specific expense that you have no idea of the date. Search in budget program, it tells you the date of purchase, and then go to the filed month and find bill or receipt.
Keep all bills stapled to monthly paper and all bills are tight and contained.
Filing receipts:
Save receipt after purchase, enter into budgeting software which also syncs up with banking program when you download. Make note onto receipt saying it’s been put into budget already.
Put receipt into monthly envelope. Put all monthly receipt envelopes into one file for the year.
Label everything! Label files with year and month contained. Label receipt envelopes with month of purchases.
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