We've been working on getting our budget together for a little while now using Dave Ramsey's Financial Peace, and I think we've finally got it! We started using cash envelopes, and stuck with it for three months like the book suggested. After that, we decided we were good at it and went to using an app for the envelopes so that we could go back to earning rewards on our credit card. Not the best choice! So, we went back to cash.
It took about a month (in addition to the previous months that I had been tracking) to get the category amounts figured out, but this month seems to be going really smoothly. We even went on a vacation and stayed within our cash amounts!
The best thing I've learned is to make sure to keep track of spending in each category. Then, evaluate your amounts for the next month and make adjustments as needed. Ryan and I know where every dollar from our spending money has gone. There's a great template at Dimplicity to make envelopes and registers. Instead of trying to keep track of the change, which would fall out of the envelopes, I round up and put the change in a tootsie roll bank. Slowly but surely, that will add up, too.
One of the greatest benefits to Financial Peace is figuring out yearly expenses (like HOA fees, property taxes, etc.), and divide it by 12. You make a monthly payment to a savings account separate from your emergency savings so that you have the total amount needed when the bill is due. This is really nice, because you're not left with those "surprise" bills.
I will keep you posted on our hopefully continuing success!
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