Category Archives: Household Finances

FFF-Lights Out

The kids and I arrived home and were finally nearing the end of a long week.  My husband and I finalized our plans for dinner and soccer practice.  The kids were eager to get home and grab a snack.  We finally arrived home and the garage door would not open.  The week before we had a new garage door installed, so I figured it was a malfunction and I thought to myself, “Here we go again.”  I took the kids out the car and we went inside and my world stopped, it came to a screeching halt.

I made a huge mistake.  My “easier way“of paying the bills had failed.  The electricity had been turned off for nonpayment.  I knew this without making one phone call, the house was warm and I absolutely could not remember the last time I paid the electricity bill or checked the mail.  I had every intention of checking it the night before, but I was just too exhausted.  Well, I back pedaled and checked the mail and right on top was the beautiful pink slip.  I paid the bill and the electricity was on in about 45 minutes.  The kids never missed a beat and my husband didn’t judge or blame me.  Lesson(s) learned.

LESSON(S) LEARNED

This one mistake taught me so many lessons:

1)  Bills need to be paid on time every time (I KNOW this already).  (This flub cost us an additional $52.95.)

2)  Trust my instincts.  (I had a feeling we had not paid the bill and a notice was in the mail, and I was right on both hunches.)

3)  Take care of home first  because no one else will.  Life had grabbed a hold of my husband and I.  My responsibilities at work were overflowing, the kids started a new school and needed paperwork completed and supplies purchased, my husband was sick again, and I had a ton of personal action items I “needed” to scratch off my to-do list.

I hit a brick wall, but I learned my lessons, reviewed our Household Financial Manual ,and refocused my priorities.  A little stumble never hurt anyone.  The real test is how fast you get up.

There Has To Be An Easier Way

When it came to paying bills on time, I was losing my mind. Every month there was always a minimum of at least one bill we forgot to pay. It was ridiculous. We were constantly asking, “Have you seen the water bill?  Did you pay the mortgage?”  Not to mention we forgot to pay our water bill once and we had to pay over $300 in fees because of a simple oversight.  The simple fact was that we were (and still are) overwhelmed. Half of our accounts were set up with paperless billing and the other half were not paperless. I check the mail about once every two weeks to make matters even worse.  In my usual fashion it was late one evening and I decided enough was enough.  We NEEDED an organized system in place STAT or our home was going into foreclosure, our cars were going to be repossessed, and all utilities were going to be shut off because we forgot or misplaced another bill.  So, I got to work.

EMAIL

The first step in my plan was to set up an email address dedicated to paperless bills, payment reminders, and account updates.  This way my water bill payment reminder email is not overlooked because my email box is too full.

PAPERLESS BILLING

After I set up the email account, I then converted all my bills to paperless.  Since I had to change the email address on all my accounts, as I logged into each account I also converted to paperless billing.  Paperless billing lessens the chance that I will forget to pay a bill and reduces the clutter at home.  Less paper = Less mess.

PASSWORD LIST

When we converted to paperless billing, that also meant too many usernames, passwords, and websites to remember.  To solve this problem, I created a spreadsheet to store all this information.  The spreadsheet was added to the Budget section of our Household Financial Manual.

Password List Template

MANILLA ACCOUNT/ONLINE BILLING

At some point, the bills need to be paid.  I use our bank’s online system to auto pay all reoccurring bills.  I set up each account in bill pay and Manilla.  Manilla is an online account and bill organizer.  You can set up your account to receive reminders or pay bills from this site.  It is another check and balance system.  It is online, has an app, and provides an at-a-glance view of all our accounts.

CHECKLIST

Last but not least, I still needed to verify that all the bills were paid each month.  I created a simple checklist and checked each bill off as it was paid.  This sheet was added to the budget section of our Household Financial Manual.

Bill Payment Schedule Template

I have now organized my money.  This plan has streamlined my bill payment system and when and how bills are paid.  It has allowed me to only pay bills twice a month on time.  I am no longer chasing dates, bills, or money.  This system just might free up  a little more time for blogging and that makes me very happy.

Debt Be Gone

10% of Americans owe more than $30,000 in credit card debt.-USA TODAY

If you have made a commitment to reduce your family’s debt and need a proven strategy, I’ve got a plan that just might work.  My husband and I have used the debt snowball method to reduce our debt.  (We married  young and were having too much fun in our 20’s.)  Little did I know, we were using the method before it received a sophisticated makeover and was named the Debt Snowball Method.

It’s no secret that I cannot function (not a joke) without a list.  So, I have created a list for you that details how to implement the Debt Snowball Method in your own Family Financial Plans.

Debt Snowball Method:

1.  List your debts in order from the smallest balance to the largest balance.  Interest rates and terms should not be considered, paying off the smallest balance first creates momentum and results.

2.  Determine the minimum payments for each debt and continue or make a commitment to begin paying those debts on time.

3.  Decide how much extra money can be designated to paying down your debts.  Use that extra money plus the minimum payment to pay down the debt with the lowest balance. Continue making payments on the lowest debt until that debt is eliminated.

4.  Once that debt is taken care of, move to the debt with the next smallest balance. Use the amount (minimum payment + extra money) you were paying on the first (already) eliminated debt, plus the minimum payment on the second debt, to eliminate the second debt.

5. Repeat steps 1-4 until all your debts are eliminated.  As always, I have an example of  a Debt Snowball Template to assist you with your planning.

How to Find Extra Funds (snowflakes) to Contribute to Your Debt Snowball Method:

  • Sell your gold-I found random pieces of gold jewelry around the house and received over $300 for jewelry I would never wear again.
  • Cut unnecessary household expenses
  • Sell your stuff (garage sale, online)
  • Request lower rates on credit cards
  • Reevaluate insurance premiums (home, auto)

Leave a comment.  Tell me about any debt busting strategies that have worked for your family.

A Budget Will Preserve Your Sanity

A budget tells us what we can’t afford, but, it doesn’t keep us from buying it.-William Feather

Creating a family budget is a crucial step in analyzing your family’s financial situation.  The process is intense and tracking expenses can be mentally and physically draining.  Once you take the time to take an honest look, you may find all kinds of treasures and mistakes that could put more money in your pocket.

The key to a successful budget is to document everything and be realistic.  Start with a template and fill in the appropriate categories.  Next, personalize the template to fit your needs by adding and deleting categories.  For example, if you do not have children, that category should be deleted, but a category for pets may need to be added if applicable.  You should be able to account for each and every dollar coming in and out.  I have included a sample budget template:

Budget Template

Once your budget template is complete, you can begin cutting expenses if needed to meet you family financial goals.  If you don’t use it or need it, cancel it.  Some of the most common expenses to cut are:

  • Gym/Club memberships (If you don’t use it; cancel it!)
  • Bad grocery shopping decisions (Shop with a plan using lists and planned meals)
  • Utilities (Reduce excessive cable bills, cancel land lines if you can, shop for better energy rates)
  • Insurance (Reduce the coverage of over insured cars, shop for better rates)
  • Subscriptions (magazines, newspapers)

Once the grueling process of categorizing money spent, money earned, and cutting expenses is complete, you can decide how to manage your money.    Some families choose to use the envelope system, by using cash envelopes to manage their monthly spending and others may choose to do a complete overhaul of their checking/savings account systems and add or delete accounts.  The updates made to your family’s financial plan need to be clear, concise, and understood by all parties involved to ensure a positive outcome.  Always remember that even solid, tried, and true plans need tweaks and adjustments.  I can almost be certain that it will be bumpy at first, but you will adjust and live happily ever after.

If you have any budgeting tips to share, please leave a comment below.

House of Money

This week I will bring you a series of posts about the dreaded topic of household finances.  I have always been the CFO (Chief Financial Officer) of our household.  Even before we were married, I was the kind of girl that saved, budgeted everything, and kept a balanced checkbook.  And then it happened, LW was born.  When my son arrived, I was walking around like a crazy rabbit.  Luckily, my dear husband flew in with his cape and took over the finances.  Motherhood, working full-time, and household management proved to be entirely too much.  Fast forward four years later, it’s time for me to resume my role.  The difference is that this time it will be a joint effort.  We now have a co-manager model to handle our finances.

By now you have probably figured out hat I may not be an impulse shopper, but I am certainly an impulse thinker.  Late one night (as ideas usually come to me), I decided in order to adopt a true co-manager model, we (of course) needed a Household Financial Manual which was simply a binder divided into 4 sections (Goals, Budget, Debt, Notes) with dividers:

GOALS

Every December, we write down personal and financial goals.  I typed our overall yearly goals and monthly checkpoints to reach their targets and placed them in the binder.  I have found the secret to goal setting success for me is the target piece.  You can create goals all day long, but it is the target checkpoints that truly holds you accountable.  I’ve included an example,(don’t forget-I have an educational background):

Family Financial Goals

In this section, I also added notes from financial gurus (Dave Ramsey’s Seven Baby Steps) that I follow or money tips I’ve found along the way that will help us reach our goals.

BUDGET

Creating a budget for our family was going to be the death of me.  I was too done.  It was not an easy task tracking every single dollar going in and every single dollar going out.  I have used every template known to exist and even created my own.  I finally found a budget template that works for our family.  When creating your budget be honest and be exact.  A budget truly creates a blueprint for your household finances.  Every business has a budget and departments are forbidden from going over budget.  The same should hold true to your household.  There are several different free forms you can use on the internet, I’m just sharing forms I’ve created or found the most useful.

Budget Template

DEBT

Credit cards, car loans, student loans, mortgages….it is all debt and it all has to be paid.  The ideal situation is to be totally debt free at least from revolving credit.  For us, the most effective way to pay down debt is using the debt snowball method.  Using this method , extra cash is used to paying debts with the smallest balance or highest interest based on your preference.  As each debt is paid in full, the money used to pay that debt is applied to additional payments on the next smallest debt or account with the next highest interest rate and so on.  We prefer to pay the debts with the smallest balance first.  It just gives us a sense of accomplishment.  There are also several debt snowball templates that range from simple to detailed.

Debt Snowball

NOTES

In this section, I simply inserted a stack of paper and I use this section to take notes.

Now, I’m not even going to begin to document our mistakes, I do not have nearly enough time for that.  I will be honest, it took us a few months to get it right.  But, the process is well worth it and my husband and I are on the same page (most of the time).

SIDE NOTE

I am no financial expert, I am just sharing my family’s experiences.