What do you do if you are part of a couple where only one of you is interested in managing the family budget? This is the case at our house. While my husband sees the value in tracking our financial health, actually doing it isn’t something that comes naturally to him. As the more analytical half of our marriage, I knew it was up to me to come up with a solution. Sure, there is budgeting software that can do this for you, but, honestly, it’s easier to do than you might think, so why spend the money and risk sharing all your logons? Here is what I do to keep us both in the loop:
1. Create a File to Track Spending and Expenses
I use a spreadsheet to track our expenses. I love spreadsheets and I feel comfortable with them – if this isn’t you, you can still do this using a notepad (I have a friend who does it this way), but I still encourage you to give spreadsheets a shot – take a look at these spreadsheet basics to get you started. Trust me, they’re really not as complex as they seem.
This file tracks activity in the checking account that we use to pay our bills. It’s organized by pay week so that we can see what activity happens during each pay cycle. Here is how I do it:
- How much of what we got paid was deposited into our checking account and
- How much money is in our checking account leftover from the prior week
- How much money will be transferred to our savings accounts
- What bills need to be paid on or before the next pay day (this also helps me know when bills are due!)
In case you’re wondering, we use a credit card for our everyday spending. So our everyday spend would show up as a single bill each month on this file. We pay off the full balance every month so as long as it stays within a certain range, we’re happy with it.
- I calculate how much money we’ll have in our checking account after bills have been paid and money was sent to savings
I call this file our “Rolling Expenses.” As the name implies, it’s a list of ongoing expenses to be paid. This was the first file I created when we decided it was time to get smarter about our finances – back in 2012! To this day, I find it helps as a record of what bills are due and when we’ve paid past bills.
***This Excel video tutorial is very similar to what I do and can walk you through the basics of creating a file like this***
2. Summarize Expenses and Savings
After using our Rolling Expenses file for a while, I noticed that, while it helped us budget by organizing our bills better and letting us always know how much money was in our checking account, it did not show us the results of our work. That is, we could not easily see how our debt was being reduced each month or how much our savings was growing. To solve this, I created a “Summary” file to help us track our overall progress. Now, in just one glance, we can see how much what we owe and what we’ve saved has changed from month to month. Here’s what it tracks for each month:
- The remaining balance of our debt at the end of each month
- The end balance of our savings account and retirement savings at the end of each month
Here’s an example of how this looked in 2012/2013:
3. Share the Information with Your Partner
All of this budgeting information is great to have, but to be most effective, you’ll want to share it with your significant other – and probably not a bad idea to share with your older kids too, it could be a great learning tool! Communication is critical. You want to both be on the same page and this is impossible if one of you is unaware of your finances.
There are a few ways to share this. In the case of my girlfriend with the notepad, about once each month her and her husband review her notepad together. And this works for them. In our household, our files are electronic, so I’ve saved our files to the cloud. I use Microsoft’s One Drive cloud service, but there are other really good cloud services you could try. I especially like that we can access our files from the One Drive app on our phones – we can look at our files anywhere and know where we stand with our expenses and how much money is in our checking account. In addition, about every 3 months or so my husband and I sit together and walk through the files.
Plus, since my husband is not as hands-on with this as I am, when he has a question about our family finances, I can update him in just a few seconds. And when we’ve needed to hold off on a big purchase, I have the information handy to help prove our case.