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Help me and my husband and I get our finances under control.
December 9, 2012 2:34 PM   Subscribe

Help me and my husband and I get our finances under control. We are tired of living paycheque to paycheque and sometimes going over budget with impulse buys and restaurant food. We need to choose a method that works for couples whose income is not always steady, and maybe some software beyond Excel. More snowflake details inside.

My husband and I don't make a lot of money to start with - he's a chef and right now I'm temping, which also means my income varies from month to month. Sometimes his does too - job security is hard to find in the restaurant scene. And we live in Vancouver, BC, so rent takes a big chunk of our income.

We each have our own bank account, and we have a joint chequing account that is basically just for paying rent. We use Excel for budgeting - it's just one spreadsheet with a list of our income, expenses and a bottom line of how much extra we'll have or how screwed we are, depending on the month.

We were thinking of splitting this up into more accounts - each of us keeps our private account, where we'd have a monthly allowance, and one joint account for groceries and bills besides rent, and the rent account so once the rent money is in there we know it's there til the cheque comes out, and also we'd make a savings account to start accumulating an emergency fund. But I'm concerned that bank fees would make this idea not so great.

What do you think? How can we split up our income so we each have an allowance, and the rest goes to necessities, paying down debt, and emergency savings?

Oh, also we each have personal projects that mean a lot to us - he is a DJ and electronic music producer and I'm in the embryonic stages of starting a handmade costume/festival clothing business. We want to spend money on our projects, within reason. Should this just be part of our allowances, or should we budget specifically for our projects?

It would be great if there were something that we could check on our Android phones. "Can I buy this right now?" "Can we afford to go for brunch?" etc.

Thanks in advance for your help. You could make a huge difference in our lives!
posted by fullerenedream to Work & Money (16 answers total) 20 users marked this as a favorite
 
We have one account, that all the money goes into, and we each get to take a certain amount out of the ATM for our "allowance" that week. All expenses are tracked through mint - which includes apps, and lets you set budgets and see where you are in those budgets. (This requires that things have hit your bank account - the $100 you spent five minutes ago isn't going to show up for a while, so you have to use SOME judgement). it works great.


In this world, there's going to be budgets for your side projects in mint. How those are funded depends on how you allocate your money. We'd probably take it out of the weekly allowance and keep cash envelopes in the safe for each of us, mostly because we both believe it isn't the other's concern how we spend that money. that's how we pay for gifts for each other as well, but our allowance is more than we each need for our weekly stuff, and doesn't include any other expenses (like gas or groceries) - it's strictly "fun money".

I like one account because that way everyone sees everything. I don't understand the point of having three separate accounts if one is only used for paying a single bill. Just put it all in one pot and divy it up. I suppose this wouldn't work if you didn't think of all the money as "our money", which is how we look at it, despite vastly different levels in income. Our income levels have changed and fluctuated, and we each came with different assets and debt, and long ago decided we were in it together. YMMV, obviously.
posted by dpx.mfx at 2:41 PM on December 9, 2012 [1 favorite]


Lady Fatbird and i both bank at Van City. We've been very happy with their service, their website, and their iPhone app, which make it easy to organize things by accounts. We also try very hard to take advantage of things like no fees if your balance is over $1,000. They also, through the website, make it really easy to have many different accounts and to transfer between them, at no extra charge.
posted by fatbird at 3:00 PM on December 9, 2012


Living paycheck to paycheck has little to do with budgeting (though budgeting makes a good - and necessary - start, make no mistake!), so much as having too many expenses for your income.

So, consider what you can cut out of your expenses - Cable TV? Expensive smartphone data plans? Cheaper apartment?

I hate to sound cruel here, but you basically need to make more, or spend less. Any budget tricks short of those just help you smooth out the time between crises.
posted by pla at 3:28 PM on December 9, 2012 [6 favorites]


My best solution was to set aside reserve money every month until I had built up several months of reserves. My income varies, so by setting aside ~3/4 months of reserves (which is "the amount of monthly bills X 2, for each month), I have a cushion. I use it for emergencies and for income fluctuations.
posted by DoubleLune at 3:29 PM on December 9, 2012


It would be great if there were something that we could check on our Android phones. "Can I buy this right now?" "Can we afford to go for brunch?" etc.

That would be YNAB.
posted by jon1270 at 3:46 PM on December 9, 2012 [1 favorite]


if you don't know when you will and won't be having paychecks, I'd suggest saving a minimum of 25% of each paycheck, making spending cuts accordingly. put that money into a reserve for when you don't get a paycheck. remember- this is a MINIMUM

cooking might become your new hobby- if you're not already making all meals at home, it will help you save a lot.
posted by saraindc at 4:35 PM on December 9, 2012


I like to use an electronic envelope budget software on my Android.

Meal planning is pretty big when it comes to saving money on food and eating out less.
posted by Hawk V at 4:36 PM on December 9, 2012


Oh, also we each have personal projects that mean a lot to us - he is a DJ and electronic music producer and I'm in the embryonic stages of starting a handmade costume/festival clothing business. We want to spend money on our projects, within reason. Should this just be part of our allowances, or should we budget specifically for our projects?

Starting now, make those projects pay for themselves. Having personal projects is great, but what happens so often is people are continuously buying "that one thing they need" but never really get anywhere with the income generating side of things.

Music production and costuming/seamstressing are full of little gadgets and upgrades that will empty your bank account in a hurry if you're not really honest with yourselves and serious about becoming financially secure.
posted by davey_darling at 5:50 PM on December 9, 2012 [1 favorite]


Davey_darling, just to be clear, we're hardly spending anything on our projects right now. We want them in the budget to help us save up for those little gadgets and upgrades. I hope to make my sewing pay for itself soon... I will suggest to my husband that he save all his DJ pay for sound gear!

Hawk V, I agree that meal planning is big! We were doing really well for a while, but now we're on opposite shifts which makes it difficult. But we try. We just got the ingredients for a big batch of farmer's pie :)

I will check out these softwares. We might go with Mint for our shared groceries/bills account, but I really like the method of You Need A Budget. Especially "Live on last month's income". That would really help with the changeable income problem!

Lots of great ideas here so far. Keep 'em coming! I really really appreciate your help!
posted by fullerenedream at 6:46 PM on December 9, 2012


Mr. money mustache (blog) has tons of tips. All our bills and savings are automated online, small weekly cash budget divided into groceries, home, and other... Other collects leftover cash from the other two. If theres cash in it, we can get take out. No cash, no extras.
Read the etsy sellers guide, especially on pricing. I use paypal, so my hobby income and purchases stay separate.
posted by jrobin276 at 8:28 PM on December 9, 2012


I just wanted to emphasize that you need to put the money into your savings priorities first. I mean, the way you've phrased the question re: "how screwed we are" makes it sound like sometimes you are not actually paying for all your expenses in a month and maybe you're putting them on a credit card. That is something that must not happen.

I'm assuming that's why you're trying to make sure you have the budget part down. But once you've figured out your budget and how much you need to save to build your emergency fund, I recommend ensuring that you have put that money into savings FIRST (i.e. "pay yourself first"), not waiting until the end of the month and seeing whether you have enough to put anything into savings. It's just human nature to use money if it is accessible and you haven't specifically earmarked it into the emergency fund. I am not familiar with Canadian banks and financial systems, but surely there must be someplace where you can put your money, aside from the same account where you keep the money you're spending, where it won't accumulate fees? In any case once you have arranged to 'pay yourself first', the rest of the expenses will fall in line to some extent - that money won't be conveniently there for you to use for other purposes anymore, and you'll adjust other discretionary spending accordingly.
posted by treehorn+bunny at 11:06 PM on December 9, 2012 [1 favorite]


Can you show us your expenses for the last six months?
posted by devnull at 4:11 AM on December 10, 2012


We might go with Mint for our shared groceries/bills account, but I really like the method of You Need A Budget.

In case you haven't already noticed, the current version of YNAB is set up to be able to store its data files in a dropbox account, so that they are accessible by iphone and android apps in real time. It's built to facilitate the sharing you are describing. It also doesn't matter what bank account the money is actually kept in; you'd just share certain budget categories, e.g groceries.
posted by jon1270 at 5:23 AM on December 10, 2012


Screw the technology. Apps won't save you. Constant vigilance and accountability will save you. All you need is graph paper and colored pencils. Put a savings chart up on the wall for all to see and start tracking the joint account and any subaccounts. Tape up a new sheet of graph paper every month to extend the chart around the room. A nice big colorful line chart that looks back at you every day. Adjust it frequently (every time someone checks the account balance? every payday? every time someone makes a withdrawal?). Keep written notes on the chart about expenses. "My project: $100" "Groceries: $100" "Socks: $20" "Car repair: $500" etc. When you see a dip in the line, look and see where all that money went. You want the line to go up and up inexorably until you get to a certain buffer -- an untouchable amount of safety cash that you should always have in the bank just in case -- after which point you are allowed to start saving for (and eventually spending money on) projects, but you can never let the line drop below the emergency level.

And for your projects, get investors. They put up the money, you put up the work, and you split any profits or losses with your investors. This will add more potential income and probably make you take your projects much more seriously.
posted by pracowity at 8:13 AM on December 10, 2012


There's a lot of advice out there about budgeting for people with variable incomes - here's one article from a source I usually trust (though I have a pretty boringly regular income myself):

How to budget for an irregular income

One thing he recommends is basing your budget around your *minimum* monthly income, rather than around your *average* monthly income. This would be especially important if you're currently living paycheck to paycheck, since a couple of months of low income could get you in real trouble.
posted by mskyle at 9:11 AM on December 10, 2012


Argh, just noticed "me and my husband and I" in my title/first sentence. I swear I did proofread before posting...
posted by fullerenedream at 1:13 PM on December 10, 2012


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