Budget or Be Broke Together!!!
Without a budget, NOTHING is possible when it comes to your finances as a married couple. It’s one of those annoying and time-consuming things that we have to deal with. We all spend money easily, but unfortunately, a lot of us have challenges with setting financial goals, budgeting our money, and staying committed to it.
Ok, so how do you and Felice budget your money as a couple?
It wasn’t until we got hipped to Dave Ramsey (“The GOAT of Personal Finance”) that we learned about ZERO BASED BUDGETING. It’s a way of budgeting where your income minus your expenses equals ZERO. With this method, you give EVERY dollar in your budget a name for the given week/month, whether it's allocating $100 to entertainment expenses for the month or putting $50 in your savings account for the family vacation you have planned later in the year.
Since money is one of the main factors attributing to the demise of many marriages, I thought it would be valuable to share with you on how we use the zero based budgeting method and tailored it to fit our current financial situation.
Here is a quick rundown on what you and your spouse can do to get started on your Zero Based Budget:
List the amount of your income source(s) (e.g. paychecks, money from side hustle)
Determine the amounts related to your paycheck deductions and contributions (e.g. 401K, Taxes, Insurance, Tithes)
List the amounts of your expenses (e.g. rent/mortgage, utilities, student loans, cable)
Determine the amounts that will be budgeted for regular expenses, such as groceries, entertainment and household items
Once you both figure that out, you simply subtract your expenses from your income.
Sidebar: There will be times when there will be money remaining for the given week/month. So you and your spouse should figure out what to do with the left over money, whether you guys use it to pay down debt, save it, invest it or even donate it.
Using a zero based budget has allowed us to know where every dollar goes for each paycheck and has given us peace of mind when it comes to our money. Our budget provides financial boundaries that we can operate in and gives us structure while we are on our #DebtFreeJourney.
Keep in mind that there isn’t one perfect way to budget your money. You and your spouse can do a budget every month, every week or even every day. The MOST important thing is that you both have a budget that’s on paper (or in Excel) and it is tailored to your financial situation.
EXAMPLE TIME: Let’s say that you and your spouse both make $2,500 (gross) every two week from your respective jobs and yall have a few bills that have to be paid for the given week/month.
For the income section of the budget, determine your Net Income for each paycheck by subtracting your retirement contributions, taxes, and insurance from your gross pay.
Next, list out all of the expenses that are due before the next paycheck and determine the total amount that is due during the related pay period.
For those things that you two pay on a regular basis or want to set money aside for like groceries, entertainment, you can allocate a portion of your money from each paycheck to those items in your budget.
Take Home Pay
Once you guys set up your income, expenses, and budgeted items in your budget, you can determine your Take Home Pay for the given week/month by subtracting my expenses and budgeted items from my net income.
After you determine the take home pay, you may have some money left over for the given week/month. You and your spouse must figure out what to do with the remaining money, whether it’s for spousal allowance, saving, investing or putting that money towards debt.
Here’s a full snapshot of the ZERO BASED BUDGET that we just went over.
Drop a comment below and let us know what budgeting methods(s) that you and your spouse use.
#BudgetingMatters #BudgetOrBeBroke #FinancialWellness