I’ve been married for 15 years and for those 15 years, my husband and I have always had enough. Many times, we had more than enough. Even in our “poor days” of him being a firefighter and me being in college full-time, we never went without. But we’ve never made much progress either outside of a retirement fund through work.
We are the epitome of month to month. And for NO real reason. We’ve read the Dave Ramsey books. We’ve listened to his podcasts. We drained everything we had saved to pay off all of our debts. That was a move we quickly regretted. We’ve tried paying everything with cash, but then I got tired of having to go to the bank two days in a row because I had met the max I could take out in a day. We’ve budgeted and we’ve cut costs. We’ve both watched our incomes increase. And then we watched our outgo increase tremendously when we moved from the south to New England. No matter what we’ve tried, we’ve failed. We’ve failed to build up long-term savings. The kind of savings that makes people feel comfortable and free. Not multi-millions, but not $100 either.
Until this month. Something clicked and I’m not sure where it came from. No one’s salary increased and no bills decreased. One night when I couldn’t sleep, I realized that the one thing that always got us in trouble was our debit card. We have always worked out of one main account. All the money goes in, bills get paid, and we swipe, swipe, swipe till there’s no money left. We don’t live extravagantly by any stretch of the imagination. But like any good American, we are some Target and Starbucks loving folks. Let’s not mention how I only like to cook about 50% of the time. I’ll do a blog post on how I’ve beat this in an upcoming blog post.
In addition to our main bills account, we have a “fun money” account and a savings account for things like vacations, wood for our fireplace, car tags, and insurance that we pay once per year. Our fun money account never has anything in it because I subconsciously know I can just swipe the bills debit card. And our savings account never has more than what it needs to in order to pay for the necessities. This is embarrassing, y’all. But, I know I’m not alone.
The only thing you have to change:
So here’s the trick that has saved us from ourselves and I can’t recommend this easy system enough. For the love of all, get rid of the debit card that is attached to the account your paycheck goes into and your bills are paid from.
Then, in a separate account, transfer in your grocery money and your fun money. We ONLY have debit cards for this one account. Once the money is gone, it it gone. And because the transaction list for this one account isn’t mixed up with bills, it’s so much simpler to see where we’re spending.
My husband and I also get a small amount of cash every two weeks. Because we’re grownups and all grownups need a little cash.
Use a third account to hold onto short term savings for things you’ll need to pay for within the year.
We also have a fourth account for long-term savings. For us, everything that goes into this account is earmarked for when my husband retires in 6 years and 9 months (not that I’m counting or anything). We plan on moving back south and I want to pay for a house free and clear. It’s a huge goal but I’m bound and determined to make it!
It really is easy. You may have to open up a few extra accounts and get a new set of debit cards, but once you’re set up, it’s a pretty fail-safe option. If you’re not banking somewhere that will allow you to open accounts for free, you need to look elsewhere. We bank at USAA and love it. If you have any military connection in your family (grandpa, brother, aunt/uncle), give them a call and see if they’ll let you get an account. We left a local bank that nickel and dimed us for everything. That has not happened one time with this bank. It’s online and I never thought that I would want that, but it’s a super easy part of our lives now.
I hope this finds you at just the right time. Let me know what you think firstname.lastname@example.org!