Right now, my entire financial focus is debt repayment but I’m slowly trying to build my savings as well. Up until November, 2014 I was not making enough money to think about savings and debt because I was barely living paycheque to paycheque. Thankfully, I’m now making more money and have the ability to start thinking long and term and I don’t want to brag, but I’m pretty much loving my current budget game plan. It is a modification and blend of 2 different budget plans I found. For most bills and debt, I’ve adopted the half-payment method. For groceries and living money I’ve modified Gail Vaz-Oxlade‘s jar system (I think she is similar to David Ramsey…but Canadian?).
Let me show you how it works:
So, essentially, I made a spreadsheet (I have all the love for spreadsheets!) and I broke down each month by how many paycheques I’ll get and the pay amounts. Along the sides, I break down all of my expenses. The goal is to have the bottom total equal to zero. T
The first thing I fill in is the savings. My goal is about $50 a pay (split between an RRSP and a TFSA).
The 2nd is the “Life” amount. The Life amount is a weekly amount (so the $250 would be split over 2 weeks) that covers the cost of groceries, eating out, entertainment, etc). I got my weekly amount from filling in Gail Vaz-Oxlade’s interactive budget. I’m not doing the jar thing because it is FAR TOO COLD in the winter to trek to the bank to get cash every week.
3rd, I fill in my expenses. Some of my expenses don’t vary (Phone, internet, and rent) while others (NB Power/electricity are always roughly in and around $40). I split the expense over 2 paycheques (and adjust the NBPower amounts where necessary). This keeps it from putting too much stress on a single paycheque. 4th: I’m currently paying off 2 credit cards, so, after expenses, life, and savings are filled in I divide the remaining total by 2 and split the amount towards the cards.
Finally, I put a “self-care” entry. My work gets crazy busy in the winter and spring. Last year was my first year so I didn’t realise that, but I was so burnt out by mid-June that I just couldn’t function. And this year, I’ve added more to my plate because I never learn. So, beginning in February, I’m going to do something once a month that helps me refocus and re-charge my batteries. (February I’m going to get a pedicure, March a hair cut, etc).
At the end of the spreadsheet, I have totals for the savings & debt repayments for each quarter so I can keep track. I love doing it this way because it is adaptable. All of the amounts automatically add up, so if I change an amount the total at the bottom will change. If it goes negative I know I’ll need to trim somewhere else. It’s really easy, and I’m truly terrible at math so I love that I don’t have to do anything overly difficult.
As to the question on whether, once married, I would combine finances with my husband, I would say yes. Marriage is giving and receiving of the whole person and I think that includes all baggage including debt and expenses. That being said, I think it is vitally important to have discussions on how to handle finances BEFORE a person gets married. Just like anything else, you have to be on the same page and willing to compromise.