For newly wed couples, how to manage the household budget may be one of the most complicated things that you could ever talk about as a couple. I know a lot of couples who fight and argue about financial concerns and decisions. How do husbands and wives of several years do it? Is there a basic framework that we could follow, so that all couples could just follow it and not have to argue?
What I did was I asked typical housewives who have survived years of marriage without constantly arguing about money with their husband on how they do it in their own homes.
My husband and I have decided that I will be the one who’ll manage the budgeting and disbursements (buying stuff for the house, bills payments etc.) although I let him know how much goes into what type of expenses we need to pay. I keep a “journal” of our cashflow – salary vs. expenses. When payday comes, I only withdraw the needed money for the period, ask the bank teller to give me an exact breakdown of the bills and coins I need so that I can put the exact amount allotted for each type of expense on individual envelopes (for ex. grocery), this helps me know that only such amount is available for this particular expense to avoid overspending. This way, I am able to organize our finances and keep expenses within the budget. – Lorellie
It used to be my husband who was in charge of budgeting and disbursements, but we both agreed last year that I be in charge. We have a monthly budget and every payday he gives me his share for the expenses, then I divide that plus my share and put them into envelopes that are labelled for different expenses. We also put aside 10% (as much as possible) for tithes and 10-20% to savings and investments (again, as much as possible). Before I gave birth, I was in charge of paying the bills. But now that we have a little baby again, he’s in charge for now. Whatever bills can be paid online, he pays online. We also try to buy new stocks through our COL Financial account every month, as much as possible. Whatever I earn from my blog usually goes to the homeschooling needs of our kids. – Tina of www.trulyrichmom.com
Since I’m a military wife, I’m geographically a single parent. I do everything, I have everything. He has allowance though. And yes, we are very typical — what’s his is mine and what’s mine is mine alone. When I get to have “blogging gigs”, I share the info with him. Haha! Seriously – Denise of www.bebengisms.com
I’m the one in charge of budgeting but I inform my husband of how the money is being spent. My husband gives me his salary in full, and he receives a bi-monthly allowance for his personal expenses, like for a boys’ night out. I have several mini pockets (those plastic card holders) with labels like PHONE, CABLE, ELECTRICITY, KID’S ALLOWANCE, etc., and the moment I receive our respective salaries, the budgeted amount will be put in those pockets. We practice the formula INCOME less SAVINGS equals EXPENSE. So every month, there is a set amount that goes to our savings, and to a special account for emergencies. Whatever can be saved from the budgeted expense then goes to special expenses like gadgets. We use a credit car for big ticket spending, like appliances, to take advantage of zero interest installments, but we always pay credit card dues in full and on time to avoid finance charges. I also make sure that I use my credit card so often to earn me necessary points to pay off the annual fee. In my 11 years of being a cardholder, not once have I paid the annual fee. I also have a budget planner in Excel which I use when I need to make adjustments to our budget, like when we are planning to have a vacation and I need to see where I can cut some expenses to allow me to save for that vacation. The budget planner is set to automatically compute, so it makes my life a lot easier. That budget planner, by the way, is downloadable from my site, so if you want to download it, just visit my page and get the URL from there. – Marge of TheHappyWAHM.com
I do the budgeting in the family. I keep mailing envelopes and label each with tithes and offerings, electricity, water, internet, forced savings, SSS and Philhealth. The rest goes to everything else. When the next paycheck comes, whatever amount that is left unused goes to savings or leisure. We lead simple lives. We do not have utang (debts) if we can help it. God’s portion is a priority, then the bills, then the basic needs. Leisure is still there but it’s of a lower priority. We agree on a fixed percentage for forced savings. We also make it a point to save for a vacation to our parents, for birthday gifts to parents and for appliances and gadgets. – Michelle of behealthyandwell.com
This is one aspect of my life that I would really like to improve on. 1. I am the solo breadwinner of the household. Hubby worked overseas last year, came home due to work issues, and still looking for work overseas again. But that’s another story, so long story short, I bring home the bacon. 2. I do the budgeting since I am the one earning. However, hubby gets a minimal allowance from me for his personal expenses, and he budgets the “food allowance” each week. I give him the allotted amount and he’s in charge. 3. I pay the bills. It’s tough being that I alone have to shoulder all the expenses, and we have kids as well. But God is good, so far, although we still have debts to pay off, we are doing okay. Like the other mommies here, I have envelopes for everything. Makes everything organized. – Sammy
Me and hubby own our salaries. Although most of the house expense are paid by him, as well as my credit card bills. My salary, on the other hand, is for my allowance, the amortization payment of our house (monthly), insurance premiums (quarterly) and savings. On investments, my profile has always been “conservative”. I availed of the Balance Fund offering of the banks. I find it quite hard to invest on equities or stocks alone like what Citiseconline offers. So, my best advice would be to assess first your risk appetite before investing your excess money. – Melissa
I have been using the “envelope system” for 23 yrs now & have been advocating it to friends. Zero debt now & investing on something that yields me 18%/annum. Whatever extra I earn online, I buy more craft supplies, or enroll in cooking, craft classes or socual media, entrepreneurship workshops. – Marryl of marrylallwrite.com
Our budgeting style is almost exactly the same as TheHappy Wahm’s! Except that my husband and I divide expenses into responsibilities: His earnings go towards the rent, car payment, utilities, gas, savings; mine go towards food, the family’s “fun money” (i.e. vacation, entertainment fund). I also manage our savings, insurance and investment portfolios. As for investments, we a mix of equity mutual funds. We’ve only started recently on stocks. – Martine of DaintyMom.com
I think there is no hard-and-fast rule in budgeting. It is as varied as the uniqueness of individuals. We used to follow the Biblical way where the wife/I handle our monies until it evolved into a more liberal approach. We try to work on the policy of honesty. We inform each other of our bi-monthly earnings then share in paying the bills, savings, tithes and investments – Jasmine
Looking at the responses from these mommies, I think the envelope system works. I have never tried that before, but it looks like it’s very effective. Although, I agree with Jasmine that there is no hard-and-fast rule in budgeting your household expenses. It really is trial-and-error until you both get it right.
Ej and I have been married for three years and we’re happy to say that we have not ‘ever’ (knock on wood) argued about money. Ej handles our finances, since he earns almost all of it. What I earn from the business, from my blogging gigs and freelance writing engagements, I keep as savings and investments. We tried it the other way around, with me handling the finances, and we think it’s more effective if he does the ‘handling’.
How about you? How do you manage your household finances? What works for you? I’d love to hear more about it.
For those who would love to learn about handling the household budget, join us at the Ready to Be Rich: Family Finances Workshop to be conducted by Mr. Fitz Villafuerte. There will be actual exercises that you will have to do during the workshop to get you started. Sign up here!
About Fitz Villafuerte:
His blog, entitled, Ready To Be Rich, has already received several recognitions including the Best Business and Finance Blog at the Philippine Blog Awards for two years in a row. Moreover, an international finance publication, Wise Bread, has likewise ranked his website as among the Top 100 Personal Finance blogs in the world. Fitz has also been recognized by Moneysense Magazine as among the top 12 most influential people in Personal Finance in the Philippines.