Thursday, April 29, 2010

Money Talks

This week Kelly's Korner is talking about saving money.

I'm sure you've heard that money is one of the main things that married couples fight about and Newlyweds are no exception. So I wanted to give you a couple of my Newlywed money management tips.

Tip #1: Savings Account Management

I shared this savings tactic via a guest post on my favorite money-saving blog, Lean with Green.

My best "saving" tip is to divide your savings account into multiple sub-accounts.

That's right, break that one big savings account into several smaller sub-accounts for the key things you save money for. For example your sub-accounts could be: Emergency Fund, Home Improvement Account, Travel Account, and General Savings Account.

This can be done really easily through Bank of American or ING. Here is what our ING Savings Accounts look like:

What this is great is that is makes you realize how little money you actually have in savings once you divvy it up into those piles and can see it split that way.

For example, say you have $10,000 in general savings. That seems like a huge chunk of change. But once you break it into $5000 for emergency fund, $2000 for house fund, $2000 for Travel Fund, then you only have like $1000 of misc savings you realize that you should be saving more.

Now that we've divided up the accounts, we've set goals for each one to $x in Emergency, $x in Travel, etc.

Creating sub-accounts helps us realize our financial goals faster and it even makes saving a little more fun!

Tip #2: Budgeting and Tracking

Start tracking all of the money that goes out and all of the money that comes in - this will help you set a realistic budget. I track it all our income, spending, saving via a giant excel spreadsheet with formulas. I've been doing this since September 2009 and it's revolutionized our finances. Is it tough? Yes. Is it worth it? Yes.

Once you have 6 months to a year of financial spending data you can set a realistic budget and really manage against that. Don’t worry if you don’t do well the first few months; it can take a while to get adjusted to the budget.

One tracking tip I have is to use credit cards to track your spending, because they can easily show you exactly what you've spent money on where... but that brings me to tip #3...

Tip #3: Credit Card Management

Credit cards can provide a lot of benefits if you use them properly. We get hotel points, cash back, airline miles, and much much more as result of our credit cards. But they can come with hefty fees if you don't pay them on time or let them revolve. When we got married we suddenly had five credit cards and we were always getting confused as to which ones we had/had not paid. We had to argue with Chase and Amex a couple of times when we accidentally paid late.

So to avoid this I went online and figured out the date that all of our credit cards closed each month and the date they were due each month and put it an excel table in date order like this:

Also, we never let our credit cards revolve. The interest rates on credit cards are just ridiculous so we pay the full amount each month. Budgeting and tracking helps to make sure we don't spend beyond our means on a credit card.

Tip #4: Be a homebody sometimes

As lame as it is to admit, the Mr. and I try to get our entertainment at home.

We joined Netflix and get 2 movies at a time (unlimited monthly rentals) as well as Netflix on demand. Our monthly Netflix bill is less than seeing one movie in the Theater for two - so we rarely go to the Theater to see movies. So what if we have to wait a few more months to see new releases?

Reading is great source of in-home entertainment, so I joined Paperback Swap to share and swap books for free.

We try to eat at home and drink wine at home some weekend nights. You can get a $15 bottle of wine at Trader Joe's and see the same bottle of restaurant menu for $50.

When getting together with friends, love to have people over to BBQ and swim in our pool rather than always going out to eat.

(Entertaining at home a couple of weeks ago)

Are there any other Newlyweds out there that have tips from merging finances, creating a budget together, or just dealing with dollars in general? I'd love to hear your comments!


Jessica @ How Sweet said...

These are awesome tips! We are bigtime homebody's and it really saves alot.

Rachel said...

Excellent tips!! I love the one about being a homebody. I think we do the same thing. I'd be lost with our netflix account! It provides us with so much entertainment on the weekends!

Aly @ Analyze This said...

Wonderful tips! I especially like your sub-accounts for your savings. What a great idea!

Chelsea said...

Good post! I see so many of my friends who aren't even concerned with saving anything... for some reason I caught the "savings bug" when I was younger and have always prided myself on being able to save such a large sum (I bought a new car in August and already have nearly 3/4 of it paid off, plus I have the entire amount I put down on it back in my savings account)

I simply live by the rule "If i don't LOVE it, I don't need it!"

Whitney Molder said...

Great post! We are newlyweds as well. I posted my money saving tips on my blog. We are a lot like y'all though. Netflix and nights in.

Brittney said...

We are really having money saving success buying things for our new home on Craigslist. We are in the process of moving to a bigger apartment and need new furniture...and I am buying everything on Craigslist...and saving a bunch! We are getting a one year old king sized bed for $125! So if you need anything for your house, check there!

Becky said...

We are exactly like you guys with money management. Instead of using a giant Excel sheet, we use one of the online programs. It makes things a ton easier to track instead of inputting everything by hand. I give myself a strict spending budget each month that I can use to spend on lunches, clothes, or other 'me' things. Whatever I have left at the end of the month goes into my new Gucci purse fund!

Beth McC. said...

I love this, I just printed out this post! I am going to check out the ING online account! Thanks for the tips! Love your blog, too cute!

Nicci@NiftyEats said...

Ww save money by havng date nights in, and drinking wine at home. I love entertaining and haveing friends over for a spaghetti night.

BudgetBabe said...

Thanks for the love! :) I think you've got awesome tips! We'll have to have you for another guest post soon! xoxo

Katie said...

I agree! Being a home body is sometimes a lot more fun, and easier on your wallet!

Meant to be a mom said...

This is how we do our funds already and your so right it really helps you to see what you have and where you are spending, how you can save and what you have to spend as "extra money" each month.

Heather said...

First time to stumble upon your blog and I love it! I write a moneysaving blog on getting freebies, saving money w coupons, shopping sales, vacation travel tips, and just trying to learn to be domestic! :) Please check it out.
Heather @

Teresa @ Grammy Girlfriend said...

Great tips...and I do the savings account dividing...Works great for us...I am adding your blog to my sidebar...

Late night blog hopping.....
Have 2 great giveaways that I am drawing for on Sunday night

Marketing Gurl said...

Those are really cool tips...I also love your picture that goes along with being a homebody!

Virginia Belle said...

So many great tips! I love the idea of splitting up your savings account. I will have to do that with ours and it will definitely contain a travel category too!

Belle said...

We must be long lost personal finance bff's because my hubs and I do use the exact same techniques- I feel like we have a million savings accounts sometimes but love that I can take and goal and say I have exactly x dollars saved for that. And the huge excel spreadsheet- I think we've just about mastered ours.

chocoholic said...

Thanks for linking this to your saving for vacation post. I'm getting married in December and we both love to travel. I love the idea of having a seperate account just for travel.

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