So how do we budget? (now, know that we aren’t perfect, we still need to work on our budget…get ready, I’m going to be very open and honest with you about our finances (this is very difficult for me to be this open; so I want to be an encouragement that you can make it too no matter what your income is) We are HUGE fans of Dave Ramsey.  We are currently following his 7 steps to financial freedom.

Currently, we are on Step 1 and Step 2

 (You will always have to repeat step 1 due to emergencies)

So back to our personal budget…my hubby gets paid $11.00 an hour. So he brings home around $380.00 weekly (net income = income after taxes are taken out) Our current monthly bills average around $687.50. (this does not include our mortgage…I’ll explain that in a second and show you a breakdown of our bills) Our food budget is $80.00 per week ($240.00 a month) and our gas budget is $50.00 per week ($200.00 a month)

Monthly Bills

• Church Tithe: $200.00 ($50.00 weekly…this can differ based on gross income, we give 10%)
• Straight Talk (Cell Phone): $90.00 ($25.00 weekly)
• Life Insurance: $65.00
• Time Warner (Internet): $50.00
• Trash: $17.50
• Car Insurance: $$75.00 (This is for 2 vehicles with full coverage)
• Netflix: $10.00
• Energy United: $150.00 (this can be different based on energy used)
• Van Payment: $220.00 ($60.00 weekly)

So Dave Ramsey suggest doing a cash only envelope system, and I do think that this works…but for us, it was difficult to stay to our budget, know how much we spent and keep up with it…so we decided to do something a little different…

Here is what we do:

• When my hubby gets paid (Remember, he gets paid weekly), we put the paycheck into a checking account called Bills
• We move $60.00 into our gas account (another checking account…our bank allows us to open as many accounts as we want)
• We move $25.00 into our Straight Talk/Netflix account (this amount can be either $25.00 or $35.00 depending on when the Netflix bill is due…we have a separate account for these two, since these two companies do not allow direct payment from our bank)
• We leave in the Bills account what is due that week (We know this from a spreadsheet that I created to show which bills go out each week…if you want a copy)
• Whatever is left over, we move into a Food/Fun account
• For our van payment, we move $60.00 a week into a Van account (that is automatically moved each Monday) and then the van payment is taken out at the end of the month (I actually move $240.00 a month into this account and extra has really helped us a Christmas each year)

(Eventually, we want to separate our Food and Fun account and set up an account for our electric bill since it can be large each month and set up an automatic amount to go into our savings each month)

So instead of using the cash envelope system, we use multiple debit cards, so we call it our electric envelope system (one for Bills, one for Food/Fun and one for Gas)…also, we don’t use food stamps or WIC. (Our children do receive Medicaid)

For our mortgage, we receive VA Disability from our service in the United States Air Force, so that amount goes into a separate account, the mortgage payment is then taken out and this little bit that is left over is a savings account for major emergencies.

We make it work on this income and it is not easy, but we are “LIVING LIKE NO ONE ELSE, SO LATER, WE CAN LIVE LIKE NO ONE ELSE”…thank you, Dave Ramsey…

We still don’t have our budget perfect and spend when we  shouldn’t and we haven’t gotten it down to a zero balance budget yet…so let me know how you are doing with your budgets!!

IMAGES: http://www.cristinarobinson.net/how-we-do-our-budget/ and http://www.twokidsandabudget.com/baby-steps-to-financial-freedom-part-3/