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Baby Steps to Creating a Budget….

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Over the past few months I have read more and more posts on different blogs I read and have recently become very determined to start tracking my money, see how much is going where, and then eventually I will switch to a cash only budget. But since as of right now “cash only ” seems to be a little over my head, I’ve started with some basics.

We are taking baby steps… The first one being my boyfriend and I decided that every Friday (pay day) we would each take $20 out for ourselves for spending cash. Yup, you read that right… only $20!! From keeping an eye on my bank account the past month I’ve realized that a lot of money was going to Starbucks, To Go Lunches, Gum, etc. so we decided to start with $20 and go from there. That means anything we need that is “extra” for ourselves has to come out of this money, no questions asked, but when that $20  is spent there’s no more random walgreens spending or energy drinks for us, until next paycheck (and if there is any left over that’s up to ourself what we decide to do with it).

This week the $20 cash worked out great, we were both much more cautious of what “extras” we were buying. Having a bank card in your hand makes it so much easier to spend money, $10 here, $7.14 there, you don’t realize it… but those small amounts add up ((and for us it was adding up to well over $20 each))! I’m sure we will have to tweak this and configure a small amount for our son’s extras (like a cookie while we walk by dunkin donuts or something) but for now we’re starting here.

My second baby step is that I have started hand writing EVERYTHING that was coming out of our bank on a piece of paper and dividing it into groups… bills, groceries, gas, “mistakes” etc. I look forward to being able to see where our money went and how much we have saved in comparison to other weeks. The other perk is that we can see what mistakes we made, and what we can cut out.

So in summation this week is the first week that we will start our budgeting and cash only system. We’ve begun with two baby steps and I’m hoping this will help others too :

1. Take a small amount of CASH from each pay check as your “play money”. DO NOT swipe your card for anything you do not NEED. i.e.- gummy bears and bottle of water. ((but we are still allowing ourselves to swipe for groceries, gas, diapers, etc))

2. Write down and catorgorize EVERYTHING that is coming out of your bank account ((we’re doing it from Pay day Friday to the end of Thursday)), you will be surprised to learn where your money is going and how fast quick trips add up!!

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About cooponmommy

After watching 1 Extreme Couponing Show I was HOOKED! Now I've turned into a saving machine, and I can't stop!

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