Getting to the end of the month without running out of money

Creating a Monthly Money Plan

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Need a Monthly Money Plan

My husband and I don't have any credit card debt, but we still find it hard to pay the bills that we have. Is there someone we could go to that could help us map out a monthly plan of action? Any advice would be greatly appreciated.

Start Your Money Plan with This Book

Have your read Debt-Proof Living: The Complete Guide to Living Financially Free by Mary Hunt? It's very good. She explains in detail how to get out of debt and stay out. And it's things you can do everyday. See if your local library has the book. Trust me, you won't be sorry. Mrs. Hunt is a writer that several years ago found herself in debt to the tune of several thousands of dollars. She gives basic, simple instructions. Please try it.
Deborah from Louisiana

Money Plan Advice from Down Under

A monthly money plan is a really useful tool. You need to know where your money is going, so begin by finding out how much you are currently spending. You could dig out your old bills and start putting down how much for the essentials, such as gas, electric, rent, and other commitments that can not be reduced. Now you know how much money you need to have. If you know how much you spent on these sort of items over the last 12 months, you can estimate for the year ahead. Divide this figure by 12. We now have a monthly ballpark figure. You need to save this amount out of your take-home pay each week to meet these commitments.

Get yourself a notebook and write in the dates of each payday, using one page for each month. Give yourself plenty of room. Now, when a bill arrives, look at the date due and write the amount and what the bill is for under the date before the bill is due. This keeps all your bills together and is a reminder to pay them on time. It also creates a great record of how much and where your money is going so that next year you will have a really realistic figure to work with. I know how hard it is to balance the budget, but knowing how much you need to meet those bills that come in really helps you to sleep nights.
Mandy (from down under)

Smart Money Tip: Why You Need a Spending Plan Instead of a Budget

Envelope Based Money Plan

Here is a solution that has been a tremendous help to my family. It is based on the envelope system. For just a few dollars, purchase a plastic (for durability) coupon holder/organizer. These can be found in office supply stores or department stores where home filing systems and office supplies are found. Make a list of all your "fixed" bills that must be paid monthly, semi-annually, or annually and the amount that you owe each time the bill is paid. These are typically your mortgage or rent, car payment, insurances, personal property taxes, etc. Then list those expenses that fluctuate from month to month or week to week such as utilities, groceries, clothing, etc. Next, divide the amount of each fixed bill by the number of paychecks you receive each month, if the bill is due monthly. For those bills that are paid semi-annually or annually, divide the amount of the bill by the number of paychecks you expect to receive during that time period.

This figure is the amount of money you will need to "save" each pay period in order to cover the bill when it comes due. For example, if your mortgage is $1000 and you receive four paychecks each month, divide $1000 by 4, which is $250. So every week, $250 needs to be saved in order to cover that bill when it comes due. For a bill that is due once a year, such as home insurance, you divide that amount by 52 paychecks. Set aside that amount each week to cover that bill when it comes due. Round up the figures to eliminate the change.

For the bills that fluctuate, estimate what you normally spend on them and divide in the same manner as stated above. You may find that spending on items such as food and clothing is far more than you thought you were spending. These are the areas that you can discipline yourself to cut back spending on.

Label each section in your coupon holder with the title of the bill, such as "mortgage," and the amount that must be added each week. We also keep an index card, labeled in the same manner, in each section to record the date and amounts that are deposited or withdrawn. Each pay period, you need to open up your coupon "money" file, and place in each section the correct amount. When each bill comes due, you make note of it on the index card, remove the cash, deposit it into you checking account, and pay the bill. No more scrambling to come up with the cash to pay a bill.

You may also want to purchase a fireproof safety box, available in office supply stores or department stores for about $20, to keep your money safe from fire or intruders.

In our money file, we have approximately 13 sections. The most important bills are listed first: mortgage, insurances, taxes, etc. Then we have those expenses that fluctuate: utilities, medical/dental expenses, clothing, groceries, etc. Finally, we have sections for other expenses: vacation, savings, gifts, etc. Taylor your file to meet the needs of your family. It's important to put the most important expenses first, as some weeks there may not be enough money to cover all the sections. In this case, your bills are paid, but you may have to cut back a bit on extra-curricular spending. At times like these, frustration can set in, but stick to it. The benefits of knowing your bills are covered takes a load off the mind and allows you to focus on more enjoyable things.

Related Video: The Envelope Budgeting System in a Digital World

Get a Money Makeover

Go to Dave Ramsey's website. I've listened to his program and read his books since 1995. I'm out of debt and able to stay home with my son. His most popular book/program is The Total Money Makeover and it's awesome! It's very simple and anyone can do it!
Mikki in Memphis

Are you heading for debt trouble? This simple checklist can help you.

Homemade Money Plan

I know exactly what you're going through. I searched for weeks to find a good plan to keep the finances in order and finally created a monthly budget plan of my own.

I created a simple one-page chart in Microsoft Excel that tracked each paycheck and where the money was to go for each check. The first table consists of a list of paydays (my husband is paid weekly while I am biweekly), the check amounts, tithes, and the net amount we have to work with (check amount minus tithes). The second table lists every regular bill that we incur during the month, the due date, and the check date from which it should be taken.

Along the bottom of the page, I created eight small "subtraction" sections. In this section I write the date of the check, the net amount, the total of bills coming from that check, and the result of the subtraction. This is the amount of money we have to live on until the next pay date. Depending on the end result, I reduce the amount by 25-50% so we can put some money into savings to plan for holidays, unexpected expenses, etc. Grocery and fuel costs are taken from each week's remaining balance. When bills are paid, you can see how much you can afford to spend on groceries. This keeps us from going overboard on extra expenses like snacks and convenience foods.

I print out several blank forms and fill them out by hand in pencil so I can adjust as necessary. I keep the forms together in a binder and review them regularly to ensure that the budget is adhered to. This allows me to create a budget for more than one month at a time and I can make adjustments if circumstances change.
Sara B.

Take the Next Step:

  • Find ways to make some extra cash each month.
  • Learn more about creating and managing a budget by visiting the Dollar Stretcher Library.
  • Stop struggling to get ahead financially. Subscribe to our free weekly Surviving Tough Times newsletter aimed at helping you 'live better...for less'. Each issue features great ways to help you stretch your dollars and make the most of your resources. Subscribers get a copy of Are You Heading for Debt Trouble? A Simple Checklist And What You Can Do About It for FREE!

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