Dave Ramsey Cash Envelopes.

This is something I'm super excited to talk about. Budgeting and money is probably my least favorite thing to discuss. When the hubbs would bring the topic up, I'd say very little and try to change the subject to anything but money. Ross made the budget while I sat there and had numbers go in one ear and out the other. I was present, but not participating. Then we go about our usual lives. Ross works, I spend, and we'd check in every few months to see how we were doing. Ross was stressed and I figured we were fine because we had adult jobs and what debt we had was "normal":  a little on a credit card, car payment, and student loans. With my free spirit attitude and small purchases here and there, I definitely wasn't sticking to the "budget" and Ross was getting stressed. I didn't like talking about money because I felt guilty. Ross brings home the bacon and I'm home with the littles during the day and do the majority of the spending. Honestly, it was putting more of a strain on our relationship than I realized.

Then Ross decided I should be in charge of the budget since I do the majority of the spending. I didn't want to disappoint, so I took the role seriously. So seriously, I remembered seeing things on Pinterest about this Dave Ramsey guy. I downloaded his book and blazed through it within a couple days. It lit a fire under my butt. I told Ross about it and had him read it too so we were on the same page and it changed our lives probably forever. We began planning to implement the Baby Steps the next month and did all of our prep work to get everything in order.

We've always had mutual funds and use those for long term saving. They pretty much saved us when we moved to Wisconsin and had literally $5 to our name. (It's rough moving with 2 kids after graduation at the end of term when the grants and loans have run dry and it's Christmas.) Baby Step 1 is having $1000 saved for the emergencies. We already had that in savings in addition to what we had in the mutual funds. We decided to pull the funds and put it toward debt. It was a little hard to see our vacation and downpayment on a house go, but it was great to get that snowball rolling. Baby Step 1: CHECK.

Baby Step 2 is to pay off all the debt except the house. This includes "Normal Debt" including student loans. We changed all of our automatic payments where we were paying an extra $100 or $20 or whatever to the minimum and put all of the extra cash toward the smallest debt. And here's where the budget and cash envelopes come in.

Our first meeting, I made sure we had treats and drinks and was determined to make it a FUN meeting. I had prepped by making all of our envelopes. I went to the craft store and found a cute Card/Envelope set that looked like the right size for cash. Then I ripped the cards apart so I could glue it on the envelope. If we were going to use envelopes, they were going to be CUTE envelopes. Then I just used a sharpie to write the category on the glued card. Ross is an Excel wizard and has always had our budget figured in there. We took our non-flexible spending categories and subtracted those from the balance first. (Things like Rent, car payment, student loans, internet, cell phones...) Then we were left with our flexible spending which became our envelopes.

BANK (for if we buy something on Amazon or whatever and we need to put cash back into the bank)
CLOTHING
ENTERTAINMENT (we kept this pretty broad. Our date budget is in here, along with family outings, and pretty much anything fun. We also put gift cards and such in here)
GAS
GENEROSITY (for those times when your friend is having a bad day and you want to do something kind for them)
GROCERY
KATE'S STASH (my own spending money)
ROSS' STASH (Ross' spending money)
TITHING (When I get tips from work in cash, 10% of that goes in this folder for church. Otherwise we leave $10 of all our income in the bank for church and pay online)
TRAVEL (so we can save for a weekend getaway or whatever we choose)

We don't have a lot of categories, mostly because our grocery and entertainment cover a lot of different things. Clothing we wanted to keep separate for if Claire grows out of her pants again or someone needs something, that way it's planned for and doesn't need to come out of another category. Some of these envelopes roll over month to month. So if we didn't use our generosity envelope one month, it gets added to for the next month. Otherwise if we have leftovers from certain envelopes, it goes to debt. We totaled up the dollar amounts needed for the envelopes and took cash out for those. We kept the automatic payment amount in the bank for those to just be taken out.

We were excited to have a plan. A plan where we told our money where to go, and once it was gone, it's gone. It took a little adjusting to using cash for everything. We had to make sure we grabbed the right envelope when we went out, but it made us more united and conscious of spending and HOW we spend our money.

We've only been using this method for a little over a month, but here's how we stack up. We came in under budget in everything. SERIOUSLY under budget. I'm talking several hundred dollars under budget. When we use cash, we are more conscious of the spending. I was more mindful while grocery shopping. We did one Costco trip at the beginning of the month to load up on meat and granola bars and other things we go through like crazy so my weekly grocery trips were significantly less. Not only did we come in under budget, but in the first month I was able to pay close to $2,000 on my credit card.  Don't ask me how, I was pretty blown away when I totaled it up.

We intended to have a mid month meeting just to check in and see how we were doing, but life got crazy and we didn't meet until we were planning for the next month. We adjusted our budget a little bit so we had more left over for debt. It was amazing to have a plan that was working and that we were headed in the right direction. Ross had the stress of the budget removed and our money meetings aren't uncomfortable for me anymore. I actually look forward to them to see how awesome we did and look at the progress. I don't feel crippled by the budget. We have money set aside for personal spending and entertainment/dates so we still have fun, it's just fun that we've PLANNED for. I'm so excited to see where this takes us!