Household of four, (two toddlers) single income ($75k/yr). So I started using an envelope system (started it with physical envelopes before i moved to creating a bank account and tracking deposits and expenses on a Google sheet) to help manage our family finances and although it was a bit tough at first to set aside almost 40% of my net income into a separate account I realized the benefit of this system almost one year in. I now put aside $3000 per month to cover recurring bimonthly, quarterly and annual expenses we have to pay (kids school, taxes, insurance, vacation etc...). I decided to include in there any expense above $200/year and that is not necessarily due on monthly basis such as monthly electrical bill or internet fees since those are budgeted and paid for from another checking account. The way I got to $3000 is after I by estimating my annual expenditures that fall under the above description and then dividing it by 12.
Although imperfect, the system is proving to be reliable as I have been smoothly and successfully financing and paying for expenses budgeted under the envelope system for more than two years now. Also what is happening is that I am finding myself with a relevant excess during most months which I guess is because I am linearly depositing a fixed amount every month in that account. On the other hand we are finding it difficult to make ends meet with the remaining disposable income in which case I am finding myself obliged to eat a couple of $100 from the monthly $3000.
Is there another way to manage these accounts payable that you do or recommend that might help me improve my system? I realize that it's very positive to have an excess in my account but I do have another savings account for emergencies, so I am thinking that a smarter and maybe variable deposit strategy might lead to greater disposable income that would release the pressure on the family? Thanks!
Submitted October 02, 2019 at 08:07PM by The_GreenBee https://ift.tt/2nOh7Lj
