Budgeting

So, John and I are trying to get out of debt.  Again.  And, if I do say so myself, we're doing a pretty good job so far.  We started getting serious about our finances in January and we've already paid off one credit card and should have another one paid off before summer.  YAY!  Of course, we have a couple more cards plus our van, but if we stay on track, I'm betting we'll be debt free again (with the exception of our mortgage) in under two years.  It took us only 8 months to get out of debt the first time, though we had two incomes, a smaller house payment and no children at the time.  Suffice it to say, our situation is a bit different this time around.

A big part of our financial plan is learning to live on a tighter household budget.  This is my area.  Since I can't contribute financially, as I have no paying job, my duty is to ensure that we stay on track.  Following guru Dave Ramsey's advice, we've decided to give the "envelope system" a try.  Last Friday we took $200 out of our account and split it up into four envelopes:

1. Groceries



2. Gas money



3. John's lunch money (John goes out to lunch every weekday)



4. Alex activities / misc.

The $200 is supposed to last us for two weeks, until John's next payday, then we'll take out another $200 for the next two weeks.  Guess what?  $200?  That's not a lot of money.  Who knew!  I did pretty good though, as of this morning I had $90 left in those envelopes.  After I went grocery shopping, we have less than $30 cash in which to survive the week. 

Living on cash only is a strange prospect for me.  I'm a debit card girl.  In fact, until last week, I don't think I'd even seen the "new" twenty dollar bill.  The twenty dollar bill people have been using since what?  2004?  It's a good thing though, because in the last week I've already seen myself being much more cautious of what I'm spending our money on.  I was never a crazy spender before, but I admit I wasn't watching our pennies nearly as closely (if at all) before I actually had to count them out when paying for something.  I'm hoping this system will help keep us on track!