We’re Switching To Cash! (Our ‘A-Ha’ Moment Weekend)

This weekend hubby and I decided, together, that we’re switching to a cash budget.

I’ve always taken care of our family’s finances. Not that hubby didn’t know what was going on, but he didn’t really know. For example, he knew we paid the mortgage sometime around the end of the month and knew the amount, but because he’s never really sat down with me all looked at the nitty-gritty of our budget, he couldn’t really appreciate the frustrations I was having with balancing the budget. We have more than enough money coming in every four weeks but I was struggling, mostly due to the fact that like 75% of our bills are due within 10 days of each other. I needed his insight to help me figure some of this stuff out.Two heads are always better than one.

He trusted me to manage the money and quite frankly, he didn’t have any desire to manage our budget. He works as a project manager by day, managing million dollar projects for a living, he didn’t want to have to come home and then deal with more budgeting. At first I didn’t mind but as things got tighter (me being on mat leave) I started struggling.

We previously had it set up separating all bills from variable living expenses (food, gas, our cat, entertainment, prescriptions etc) so basically if there was money in the chequing account we could spend it. He’d see the amount and know that’s what we had for the week (gas, groceries, cat all included). This only works so well.

If one party in a relationship doesn’t understand why we only have ‘x’ dollars this week because of ‘x’bills being due, it’s easy for frustration and resentment to start.

Questions start, even if done in a loving way; What did I do to only leave us with this amount of money? Why does it seem like I’m nickle-and-dimeing every purchase?

Because both parties weren’t 100% on the same page, it was difficult to make things work. I was feeling guilty about managing money a certain way, especially when I had to constantly say ‘no’ at a purchase.  I found it easier to say ‘yes’ and scramble to make the money up at the end of the month some magical way. This only works for so long.

When I realized permanently changing our mortgage billing date by a few days would help in the way that our paycheques fall, I called and changed it, even though we had to pay the adjusted interest amount to account for those days. When I tried to explain to hubby why I had to make the change he wasn’t understanding at first, all he knew was that we had enough money coming in every month and didn’t think there should be any issue. It was in this discussion that my hubby finally realized I may be in over my head managing it alone.

Yes I may be university educated 2x over; Yes I write a PF blog and read everything to do with money all.the.time; Yes I stay home on my birthday to watch a DVR full of ‘Till Debt Do Us Part’ but No, I couldn’t make our budget work the way I knew it could work…alone.

He sat down with me on Friday night after a monster work week and together, for 4 hours, we managed our budget, week-by-week for the next 3 months. I haven’t felt this relaxed about money in a LONG time.

I don’t think money is evil. I think ignorance around monetary issues and not addressing them can cause people to be evil though. I’m so glad I don’t have to think about money for the next while and when I do I know hubby will be there with me to fix any bumps in the road.

After we got the budget worked out and balanced, he made a to-do list, included on it was for me to buy/make/whatever a money envelope/jar because according to him, we were now on a strict cash budget (music to my ears)! Did I mention we also figured out and budgeted for a pretty kick-ass CASH CHRISTMAS?! I have so much relief knowing where the money is coming from and how we’re paying for stuff and when.

2012 isn’t over yet but has been a monumental year for hubby and I in terms of growth as a couple.  We’ve been together since high school, spending our lives growing up together. I’m so proud the we’re able to acknowledge that we’re not perfect and address areas we know need help. Reminds me how much I love him.


photo source

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  1. Good work on looking 3 months in advance! I’m normally only accurate to about 1 month, particularly with Christmas around the corner.

    It’s so important for a couple to be on the same page when it comes to the family finances. I have seen so many couples struggle or even split due to different views on money and how it should be spent each pay.
    Glen @ Monster Piggy Bank recently posted..Buying Land and Building a House – Part 2My Profile

  2. I had to smile reading this post, Catherine, as Vonnie and I have done a very similar thing recently. For each bi-monthly pay period we sit down and map out our spending / saving plan. Then each Thursday we review the spending plan for the next week – Friday I withdraw cash on my way to work, and we make up envelopes for each of our categories. When you have cash in hand, it makes it so much harder to overspend. Congrats on getting hubby on board with being more involved….and good luck with the cash budget – I just KNOW it will work well for you. I know exactly how that “more relaxed feeling” feels…..enjoy it!
    Travis @Debtchronoicles recently posted..Save Money by Cooking at Home: Japanese Steakhouse EditionMy Profile

    • Thanks so much Travis! i’m excited, even if we don’t have that much money every week (and it will be extra tight until Christmas) but we’re up for the challenge! You and Vonnie are inspirational!

  3. Awesome for you! It’s always good to get on the same page, especially when it comes to finances. We do a cash budget for Christmas as well, it makes it so much easier for us.
    John S @ Frugal Rules recently posted..4 Minutes That Changed My Life ForeverMy Profile

  4. Hey, nothing wrong with going to old cashioned cash! I know several people who budget this way and it works well. I hope that it works out for you!

  5. I need to get the boy more involved in our finances as well. He is extremely clueless and thinks that there’s no work to be done with it!
    Michelle recently posted..Spending, Life, Income, Food Updates…My Profile

  6. Yay for unity!!!
    L Bee and the Money Tree recently posted..GUEST POST: Personal Finance Lessons During the Camping Trip from HellMy Profile

  7. Great for you !! I think it will be better doing it together; less resentment as you say. I’m sure things will start to look up for you and hopefully you don’t feel as if you are nickel-and-diming as much!
    Gillian @ Money After Graduation recently posted..Beauty Tricks that Actually WorkMy Profile

  8. This is awesome. An open money talk and common goals can only strengthen your relationship.
    Pauline recently posted..Little house in Guatemala, week 2My Profile

  9. Congrats on being able to sit down together and work through the difficultly that is personal budgeting! I meet a lot of people that really put the responsibility of managing the household budget on the wife, and without realizing it many husbands place a huge amount of stress and anxiety on them. It’s often difficult to manage things and explain it when one person doesn’t know precisely what’s going on. So I’m glad you were able to work it out together!

    Getting on a cash system really changed our finances and helped us to be more accountable than ever! It was difficult at first, but we’ve done it for 4-5 years now and I don’t think we’ll ever go back to using debit/credit only.
    WorkSaveLive recently posted..PerkStreet Financial Review – The Best Online Checking AccountMy Profile

  10. I know the 10 days you’re talking about…… we get our paycheques and then pay ourselves 600/week for all our expenses. But our expenses are never that consistent. The hydro, gas, and credit card bill all happen the same week. (we put our groceries, and gas on credit for the points and tracking, we never have a balance) Then when you consider property tax only happens 4 times a year, house insurance is only once, pretty soon it’s a complicated web of numbers. Congrats and sitting down and making a plan together. Now you’ll be able to rest easy at night…. well if you’re baby will let you 🙂
    Mandy @MoneyMasterMom recently posted..The Evolving Bucket ListMy Profile

    • We pay property tax every month (with our mortgage payment) so I don’t have to think about that and we pay house and car insurance monthly, I figure there’s no difference between setting a monthly amount aside in the budget for an annual payment or paying for it monthly. Haha yeah baby isn’t letting me rest too much at night yet (still eating through the night) and I’ll feel even better when we get an ER fund going!

  11. Yes, yes, and more YES! We have had the same issues in the past! And remember, this isn’t the only meeting you should ever have. Definitely do a monthly check-up to make sure you are both still on the same page month after month.
    Cash only is the BEST way to ensure you don’t over-spend. Though I do advocate using credit cards for their rewards, switching to cash to get your budget solid for 6 months or so is an awesome idea.
    Jacob @ iheartbudgets recently posted..6 Month Blog Anniversary and $25 Amazon Gift Card Giveaway!My Profile

    • We don’t use credit cards b/c of the DMP although credit card over usage was never our problem, once we’re out of the DMP we’ll switch to using one. Prior to deciding on cash we used our debit card from one account only (money for bills was always separate) but constantly checking your online banking is a pain in the butt, cash is visual and the psychology around using cash is different. I’m excited for us!

  12. I’ve totally been there – back when we first got married, I did everything budget wise and it got to be too much responsibility to carry alone. Talking it through and doing it together made a world of difference in how I felt, even if it didn’t change a whole lot on a day-to-day basis. Glad to hear you’re feeling less stressed than you were not too long ago!
    Mrs. Pop @ Planting Our Pennies recently posted..Our $50K Duplex Is Worth $97K – Why? Part 1My Profile

  13. That’s good you guys finally got on the same page. I can imagine that must be somewhat frustrating to always be the one sort of managing things. And now you both get to work towards something!
    Budget & the Beach recently posted..Changing Course/$20 Amazon.com Giveaway!My Profile

  14. justin@thefrugalpath says:

    It’s impossible to budget money if both sides aren’t on the same page. This is something my wife and I are also going to work on. I think starting January we’re going to live by a more strict budget. Kind of like Gail’s glass jars, only ours are going to be 2 pint containers that I get soup in.
    justin@thefrugalpath recently posted..Common Reasons Why People Complain About MoneyMy Profile

  15. I guess my wife and I have gone over finances together, but honestly, it’s mostly all her. I guess the difference is that I don’t get resentful when there’s less money some month. I just assume that she’s taking care of things and whatever. I just do what she says. “TB, you have $X you can spend on whatever you want this month.” “Okay, thanks Mrs. TB” Haha, I guess I”m a simple dude!
    TB at BlueCollarWorkman recently posted..Tips From a Former Car Thief on How to Protect Your CarMy Profile

    • haha That was working for us for a while but things had to change for us! Resent maybe wasn’t the proper word, I think more frustration at the forced changes (since income being drastically decreased).

  16. Glad to hear you had a breakthrough weekend! I was smiling while reading this.
    I’ve never used cash, but one of my friends swears by it. She uses cash for her “allowance” so she can always make decisions based on the amount she sees right in front of her.
    I’m also glad to hear that you were easily able to switch your billing period for the mortgage. We have carefully set up when our car payments, strata fees and mortgage payments land, so that they are balanced throughout the month and shortly after, but not on, our pay days.
    Anne @ Unique Gifter recently posted..Creative Cash Gift: Dollar Scavenger HuntMy Profile

    • Yeah we use to have everything bi-weekly following out pay period but then our two ‘free’ pays weren’t actually free anymore so we’ve changed to monthly.

  17. Agreed that money is not the root of all evil, it is a thing, it is what people do with the thing that can be evil.

    It used to be crass to give cash at Christmas, sitting where I am now, I have no issue giving cash. Good luck on your financial journey, sounds like you should be on the right track.
    Big Cajun Man recently posted..Will You Be Able to Pay for Your Kids Education?My Profile

  18. That’s wonderful news! I’m so glad to hear you are working together. It sure is a relief to have that kind of support!
    Janine recently posted..Planning for PuppyMy Profile

  19. I’m glad to hear a happy budgeting story. So often people argue. We are about to be right there with you, but I’m not sure I can do the cash thing. We’ll see.
    Kim@Eyesonthedollar recently posted..Obesity in America: What It Costs UsMy Profile

  20. We do a cash Christmas as well 😉 It’s a nice feeling to be able to just buy a present and not feel any anxiety about paying for it!
    CF recently posted..Why you should chill out about student financeMy Profile

    • Exactly! To be honest we always have but it’s been a scramble the weeks leading up to it with no definite spending plan making it easy to lose track and overspend.

  21. We are phasing out debit card usage in our household and switching to cash only (with an envelope system.) Things are spiraling out of control and this will -force us- to make strides in our goals, with the encouragement of visible progress. My significant other and I had a terrible adjustment period when we dwindled down to one income but we are finally in a good routine where we both feel satisfied and on the same page. It took oodles of communication, however, to reach this point.
    Jennifer Lynn @ Broke-Ass Mommy recently posted..Cripes. Nearly Our Entire Family Emergency Savings Got Gobbled UpMy Profile

    • Good to hear! For us it’s not that we had a debt card problem per se, we only debited out of our ‘spending’ account but there was more than a few times we caught ourselves debiting from our billing account which we suck at making back up. Cash has a different psychology around it’s usage too. Last night when I got groceries I was SO much more intune with making sure I didn’t go over rather than caring if I only went over by 10-15 bucks…those small amounts add up!

  22. Working together is key. Sometimes you just have to sit down and work out a solution.
    Daisy @ Add Vodka recently posted..Spending Money Isn’t BadMy Profile

  23. Hopefully we all eventually find our perfect system. If you’ve found the best solution for this period of your life (funds available/family situation/spending patterns), then that must feel like a huge weight off your shoulders.
    If you find it’s helpfull to have planned out the next three months, then can I suggest you take it to the next level? Try a full year. I’ve been doing it since 2005 and it’s completely changed our finances and long term life plans.
    I know, I know. I’ve heard it before when I suggest this, “how can you possibly know what you’ll spend next June?”. Well, based on our normal patterns, I currently have planned in the week of June 10-14, 2013, a tank of gas for each vehicle ($40, $80) and groceries $180. Period. When I plan out the next year on my spreadsheet I work my way down row by row through the weeks. First a header with that weeks dates “week 2 June 10-14” then one row per planned item and the amount in the next column. In the last column a running total assuming that planned item was immediately deducted from the previous balance. Every week gets the two gas fillups and a grocery row. Then I go through the entire year adding our pay days in on every other week. Put the pay following the bill to assume the worst case. I add the mortgage payment in every other week, property taxes and internet on the week containing the 1st of the month. Electricity in week 3 each month (different estimated amounts each month based on actual amounts from the past 5 years). House/car/life insurance in week 4 each month. Then I add in the occasional bills. Vet every May, license renewals every two years on our birthdays, extra tanks of gas in weeks we’ll travel to visit family out of town. Then finally, every week the last item is “transfer excess to ____”. Everything goes on our credit card (except mortgage, electricity and property taxes). I pay off the total spending for that week on Friday and assess what’s left in the account and what is on the plan for the next week/month. Then I transfer out every thing not required in the immediate future (but always keep a $1000 minimum to avoid bank changes) and either add to our retirement accounts or make an extra mortgage payment. Because we’ve cut all non essential spending out of our budget we are now able to live most weeks on ~55% of our take home pay. If we decide one week to replace a lamp, or need a new dishwasher, or go to a concert, we just have less excess to transfer out. I don’t budget for clothing because we so seldom buy any (mostly we receive it as BD and christmas gifts). We rarely eat out because it’s just not important to us. As the weeks pass I gradually replace my planned amounts with the actual numbers. If a planned spend doesn’t happen, I delete the row. If we decide to do something non-essential one week I add a row. My husband and daughter just got hair cuts today so my weekly transfer I thought I’d be making this evening will be short by the amount of the cuts. No big deal.
    All I’m suggesting is that if you can plan out three months, and that gave you a sense of control, imagine what having a crystal ball to a year in the future will give you. Yes things can change but I love being able to scroll down the spreadsheet and know that if we follow the plan we’ll have $X dollars of excess either sitting in the account, or that has been sent off to the mortgage and retirement accounts. Cutting the unecessary spending and consciously moving the excess out to where we can’t touch it, on a weekly basis has meant we are now planning to retire in our mid 50s rather than wondering if we’d be able to retire at 65, like we were doing back a few years. We never racked up a ton of debt but we were certainly wasting a lot on junk I can’t even remember now. We consciously decided early retirement while still taking a major trip every year were our ONLY two priorities and everything else was negotiable. Having a clear path forward is making that happen.

    • Thanks for the comment! The reason we haven’t done more than 3 months right now is because our circumstances will change when I go back to work in 6 months. We’re working on this (current) 3 months, then we’ll deal with the next and finally when I go back to work we’ll work on something more long-term. Right now we just want to see if what we’re doing will work…make sure all the glitches are out so-to-speak. Hubby’s pay is always the same, mine will vary so we’ll want to establish an average of that as well. Our in-term goal is to be debt free (minus mortgage/car) then define our future. If early retirement is in the cards for us that’d be great! Thanks for stopping by!

  24. I love the topic of this post! That when budgeting two incomes, both parties need to be aware of what is happening to their money. It’s great that you two sat down and went over your budgets like that.

    However, I wanted to read this because I am curious to learn more about cash budgets and I don’t see where you discuss that, other than for Christmas. Maybe I missed it in your post? What exactly is a cash budget? Or how are you two determining a cash budget?

    I understand the idea of only paying for Christmas gifts with cash, but for the rest of the month, how are you discerning the use of cash?

    I apologize if I missed this in the post or if I missed the point of the post entirely and was confused by the title.

    • We only use tangible cash for non-bills (food/gas etc) all our bills (mortgage, student loans, phones, etc) get paid out of our bank account which we don’t touch. We simply withdraw funds for the week that we will be paying for (again, groceries, our cat, gas) and pay for these items in cash. Yes for Christmas we will be spending only cash when we shop/budget for Christmas parties etc. If you’d like more info feel free to e-mail me!

      • I guess my question is how much cash do you take out for the week? And when you run out before the end of the week, is that it? Or do you just withdrawal more?

        For weekly spending, do you take your monthly budgeted amount and divide? Or do you sit down and try to calculate it out on a week-to-week basis?
        Leslie recently posted..Sunday Listen: Somebody’s Crying by Chris IsaakMy Profile

        • Nope never withdrawing more!! What we take out has to last us. Currently we take out 200.00 (mat leave budget) of which we budget 75.00 for groceries, 50.00 for gas, 10.00 for the cat food-these never change. 10.00 is currently being set aside for Christmas as we’re short 60.00 in our Christmas fund/budget, the other 50.00 or so is allocated depending on the week. For instance this week we’re going to a hockey game with friends so will probably save 20.00 for that (parking/possible drink in arena), hubby may need to meet with people for work so may need to budget a lunch out for him (which he usually gets back in expenses), haircuts/baby clothes/diapers/wipes etc etc…we budget by the week. We usually each get a few dollars/week from this as well if we want to save up for something or meet friends for coffee/whatever (10-20 each/week depending on the week). Does this help?

  25. Just found this one looking back through archives. I am in this boat..I have been in charge of our money which has lead to several fights and some mild accusations of me always saying no regarding spending money. I have just learned that it cant work for only one person to know what and when things are coming in and going out. So this weekend we are sitting down for a not so fun chat and budget examination. I will be going on mat leave in September so we need to get ours figured out ASAP. Thanks for the encouragement
    Jules recently posted..Weekend ReportMy Profile

    • Catherine says:

      I’ve been with my husband for almost 11 years (married almost 4) and it’s only been this past year that we’ve actually discussed money. We’ve always been open with each other and as long as we’ve lived together had everything joint but yet never discussed it. I’m so glad that we’re finally able to talk about it. Good luck to you guys!


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