Sticking to the Budget!

This is one of the most difficult things to do, when it comes to household finances.  There are so many different methods out there.  There's the "jar" method, where you have a jar for each expense category and you put your monthly (or weekly or biweekly - depending on your budget cycle) budgeted amount of cash for that category into the jar.  Then you simply remove the cash from the jar as you need them. 

Then, there is the envelope method, where you use envelopes instead of jars.

Personally, I am very much an electronic person.  I don't like carrying all that cash in my house or on my person.  I'm the kind of person who will use the cash if I have some sitting in my wallet because I have "trained" myself over the years that cash on hand = cash to use!!  The debit machine and automatic bank withdrawals were the best invention for me.  So, for those of you who are like me,  this is what I do to "bucket" my money.

I bank with PC Financial.  Simply because I do not like the idea of paying any fees.  I will discuss banks and fees on another post!  I have also set up an account with ING Direct which is linked to my PC account (a virtual account linked to a semi-virtual account - told you I was an electronic kind of girl!).  Now, what I really like about ING Direct is, they allow you to create "sub-accounts" in your account.  So, I created a few "sub-accounts", one for my Property Taxes, one for my Kids' Clothing, one for Savings, one for Auto Maintenance, etc.  There is a limit to the number of sub-accounts but you can call them to override, if you really need to.  I have not had a problem with what I needed to use.  After the account "buckets" were created, I then set up auto-transfers from my PC Financial account to my ING Direct sub-accounts, the amount of money I had budgeted per month.  For example, I have $200 per month budgeted for Auto Maintenance.  This is money that I had set up to automatically transfer from my PC Account to my ING Direct Auto-Maintenance sub-account once a month, saving the money for use when I need to fix our car or van.  When my car's transmission line needed to be fixed, the quote was $800.  I checked my Auto Maintenance sub-acount and found that I had just over $800.  So, I simply transfered the money from my ING Direct sub-account back to my PC Account so that I could pay the Mechanic.

I have set up all these auto-transfers from the PC Account to the ING Direct sub-accounts for all the "fixed expenses" that are paid out only a few times a year, such as Property Taxes, Auto Maintenance, Beginning of School kids clothing, Savings, etc.  ING Direct also pays out a higher interest amount than most other banks, which is an added bonus.  This ensures that the money that will be needed are put away and we don't think that we have all this extra money to spend - when they were all "spoken for".

I am being rushed by my daughter to finish this because I had promised her a shopping trip.  So, I shall continue another day on how to stay on budget!