Rawson Money Management 101

I have so many ideas for this blog and I unfortunately have not been keeping up with my goal of blogging at least twice a month. This entry I have been meaning to do for awhile.
I get asked frequently for money management advise. I do work in finance, but long before I started that career I was always very conscientious of budgeting and making the most of my money. There were a lot of things I had to begin paying for myself at an early age and I learned to think twice before engaging in frivolous spending because we can't have everything, so its important to prioritize.

We have four very simple money rules that we abide by in our household:

• Create a monthly budget and actually review it monthly so that you can manage variable bills such as car tags, home warranty renewals, and planned parties. I have a notebook that I use and I take about an hour or two a month to review the monthly bills and any variables that may need to be included for the month. I then coordinate the bills with our pay periods. This is very simple and I strongly suggest it be adopted by anyone who feels that their money management system is inefficient and they are not ending the month as planned. Also, always make sure to budget for saving, pocket money, gasoline, and some entertainment or else these items end up causing the budget to be off and often times these expenses go on credit cards.
  
• Create a spreadsheet in excel/numbers/quick book's that allows a big picture view of your total household income vs monthly bills. When you do this for the first time, if you are in the red, you will have all the items in front of you to review so that you can see what can be cut and what needs to be tackled first to help relieve the situation. I create this spreadsheet annually and review it whenever we get pay raises (or unfortunately pay cuts, which was the case for us last year) so that we can review our savings potential and see where we are spending our money and make a realistic monthly budget
  
• Shopping is usually planned. We shop sales, use coupons, do price comparisons for special events and travel. I clip coupons for groceries and cross check the ads. Department store savings are such a money saver (gotta love when I get a 30% off at Kohl's!) these are great times to invest in new wardrobe pieces or the new season of clothing that my daughter needs. I despise paying full price!!
  
• Once you have hit your budget, you are done! Unless its an emergency, stop spending. We all find ourselves over budget at times but continuous overspending creates a snowball of debt that only becomes increasingly difficult it tackle. Eating out for $45 when you have already hit your budget is careless. Cook at home then eat out next week when you can afford it and will enjoy it more. Now, we all do need to live a little, so at times (like our recent vacation when I hit the Coach outlet!!) we do overspend, but we have the cash to cover it. Believe me though, I'm already plotting on how to plan the next months budget so I can make up for my indiscretion :) As long as we keep track of our spending and stay in budget , say 90% of the time, we aren't scrambling to figure out how to take care of our monthly obligations and we are also able to enjoy life more by eliminating a major stress factor. I have plenty of things that stress me out, I need to do my best to keep a handle on what I can.

All pretty simple and easy. Nothing is fool proof, as the saying goes, shit happens. We do our best to live a full and happy life within our means. Budgeting our money and planning our shopping takes very little time for the pay off it provides in the end.