Friday, May 16, 2008

Frugal Friday-Whats In My Wallet

Probably one of the best changes we have made to help us manage our money better and be more accountable is going over to a cash only system. Our system is similar to the envelope system but without the envelopes. We take out a certain amount of money every week, a portion of it is just for groceries and the other amount is split between the hubs and myself as "fun money". This "fun money" I believe is crutial to our state of mind, it allows us to budget for entertainment. I think some people when they decide they are going to be more frugal they do drastic things and don't allow for any "extra's". Even if its only $20 a month I think it really does help your state of mind to have some mad money to use to go out for coffee, to go out to yard sales or to go to a movie with your cutie.
This cash system makes it so I can't go over my grocery budget, because I only have the budgeted money with me. Before I go to the store I estimate what my bill is going to be, I write a detailed list with approximate prices. While going through the store I will update the prices so when I go to the register I have a very close idea of what my total is. This in itself has saved me a great deal of money as most of the grocery stores around here have a policy that if something rings up wrong at the register it is free. I've gotten shrimp, a case of seltzer, cuts of meat all for free just for paying attention to what I'm paying.
Another thing I'm trying to do as I save more money is to have a grocery budget surplus envelope to save up for when we have company and also for throwing parties. I would take the money that is leftover from my weekly trips and put it in this envelope. Then we wouldn't have to use any of our other money for throwing a party or having friends over. I'm still learning on this whole system but I know it has helped me focus on what I have and not go over.
We do use our credit cards for gasoline to keep up our credit rating. The hubs has about an hour and a half commute to work so it would be too difficult in our house to do a cash system for gas. Most frugal sites point far away from the credit cards but I think my time as a mortgage underwriter has shown me the importance of a good credit rating even if you don't want to use it. What I will say, if you do use a credit card have a budget for what you want to put on it. We put gifts for others and gasoline on our credit card. We have a monthly budget for both of these and pay off our two credit cards monthly. NEVER, ever leave a balance on your card; thats what starts getting you in trouble.

What are you guys up to?
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Razor Family Farms has been cleaning up! She's been making her own detergent, this is completely on my list of frugal stuff I want to do!
Trace is rocking out with multitasking and being a superhero by saving money on gas, exercising(seriously it took me 10 minutes to try to figure out how to spell that!! Dude!!) and saving the environment; all while making time to smell the flowers!
Tara is saving money and encouraging others at the same time! Gotta love those Tar-jay deals!
Em In Stitches also has an idea about the great credit card debate and saving some cash on gas. She also threw in an idea for the little ones.

Found out that Frugal Friday didn't start here-the original is at Biblical Womanhood


Trace said...


Tara said...

That really is a good have a specific credit card for certain things.. My husband and I agree, must pay off credits cards monthly.. they aren't free bees lol I am always leery of keeping "Cash" in envelopes. Does that work for you ..or do you find it tempting or difficult to withdraw cash ect...

Dirkey said...

The money system has worked extremely well for us for groceries, I've found that if I used my CC I would round things and spend about $20 extra a week. Having the cash kind of forces me to stick to my budget.
I usually keep the cash in my purse but just separate it from my fun money.

Razor Family Farms said...

What an excellent post on budgeting and strategical shopping! I love Frugal Friday!!!!


Em said...

I've typically used by debit card to pay "cash" for everything, but then I end up spending more than my budget. Thinking about switching to a cash system, as well. My idea this week was cash vs. credit card related too...but a little more specific.

Michelle Smiles said...

I'm not as truly committed to the frugal ways as many...but I try to do my little things here and there. This week, I made Shrimp Pad Thai at home instead of ordering out (I'll post the recipe today or tomorrow) and tomorrow I'm headed to a big consignment sale to try to find a crib for Tessa or double stroller or outside toy for Sabrina.

I wish I was organized enough to grocery shop with cash but I usually walk in not knowing what we are having for dinner until I see it. I know, bad, bad, bad.

BarbaraLee said...

I use a plastic coupon divider. It last longer. Now that hubby has a stead income I have to redo our budget. But I to like using cash. Forunately dh doesn't have to drive that far & drives an 86 chev. truck that is in good shape.