How to get family finances in order and live simply?

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mkipp

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My wife and I are trying to get out debt paid off, and save more money. We have made mistakes, but at 34 I think we can fix them. The issued is Credit Cards and we are not using them, and trying to pay them off. We are using cash only, and it makes a big difference in how we spend. We seem to over buy at the grocery store, and buy our toddler daughter way to much stuff. I am just looking for any advice and or tips on how you did this. We make a good salary, but have over spent. We are trying to get more connected to our faith, and trying to get our finances in order. God Bless.
 
My experience with 4 children is you can give too much energy to your finances (the root of all evil) Instead just trust that God will provide for your needs and focus on “do I need this” vs “do I want this” when you make any purchases. With kids, use thrifts stores, clothes sharing with neighbors and garage sales as much as possible (they outgrow most things anyway!).
 
mkipp said:
My wife and I are trying to get out debt paid off, and save more money. We have made mistakes, but at 34 I think we can fix them. The issued is Credit Cards and we are not using them, and trying to pay them off. We are using cash only, and it makes a big difference in how we spend. We seem to over buy at the grocery store, and buy our toddler daughter way to much stuff. I am just looking for any advice and or tips on how you did this. We make a good salary, but have over spent. We are trying to get more connected to our faith, and trying to get our finances in order. God Bless.
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Are you using any plan for paying off your debt? Dave Ramsey is great on this issue - a lot of people have done his plan and paid off all their debt. My main tip is to put your savings away BEFORE anything else, and put enough away so that it hurts a little bit. Groceries have gone up so much over the last year, it’s ridiculous. Buying pre-cooked food adds a lot to the grocery bill, I hope someone in your household can cook, because that saves a lot of money. Stick to un-fancy dishes like chicken casseroles and make things ahead and freeze them. Get a crock-pot if you haven’t got one.

If both of you work I think there is a tendency to buy stuff for the kids instead of spending time with them. You will have to squelch that right now or your daughter will connect things with love all her life. And as they grow up, their “toys” get more expensive!" Start now with giving her little chores to do so she can participate in the economy of the household and feel like she is a part of whatever happens. “We can’t afford that right now” is not a bad thing to say to kids.

Good for you for realizing that you don’t want to be a slave to debt. Wish our elected leaders would realize the same thing.

👍
 
I make a budget plan in excel. I take out bills first, followed by gas, followed by food. Anything left over than gets pushed to the next pay period. If the kids need clothes, diapers, etc. It is budgeted.

I write a grocery list that has my max allowance for each item. So if cereal is on a sale great, that covers where I might have been under in my estimations. There are 4 of us, I typically spend around $100 on food for 2 weeks. Diapers cost us about $80 every 6 weeks.

We pay $50 over the minimum payment on our credit card. We also take almost our entire tax return and put it into our debts. Now instead of taking us 10+ years to pay it off, our debt should be gone in at most 3 years.

I have a fairly big family, so clothes get past around a lot. Most of my kids’ clothes are from their cousins. I don’t really buy toys for my kids, they get so much from family already. I shop sales, outlet, and consignment. I try to save where I can. With that savings we can get a zoo membership, and are able to give our kids experiences over items.
 
TheRealJuliane said:
Are you using any plan for paying off your debt? Dave Ramsey is great on this issue - a lot of people have done his plan and paid off all their debt. My main tip is to put your savings away BEFORE anything else, and put enough away so that it hurts a little bit. Groceries have gone up so much over the last year, it’s ridiculous. Buying pre-cooked food adds a lot to the grocery bill, I hope someone in your household can cook, because that saves a lot of money. Stick to un-fancy dishes like chicken casseroles and make things ahead and freeze them. Get a crock-pot if you haven’t got one.

If both of you work I think there is a tendency to buy stuff for the kids instead of spending time with them. You will have to squelch that right now or your daughter will connect things with love all her life. And as they grow up, their “toys” get more expensive!" Start now with giving her little chores to do so she can participate in the economy of the household and feel like she is a part of whatever happens. “We can’t afford that right now” is not a bad thing to say to kids.

Good for you for realizing that you don’t want to be a slave to debt. Wish our elected leaders would realize the same thing.

👍
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I am the cook, because my wife is not the best in the kitchen. I do use a crock-pot, but we never seem to eat all of what is made. We throw out so much food it is sad. My 3 year old now says “I want that.” all the time. I feel bad not buying her stuff, but she plays with something for a day and then never again. I have looked into Dave Ramsey.
 
Early on, I taught my children to say *I like that *rather than *I want that. *So often with children, esp little ones, their interest is momentary–how many toys have we parents all bought that the children wanted *so badly, *only to see the toy abandoned in favor of something else after a brief time that did not justify the amount spent on it!

For those who live near other families with children of the same age, a “toy exchange” might be a good idea 🙂
 
mkipp said:
My wife and I are trying to get out debt paid off, and save more money. We have made mistakes, but at 34 I think we can fix them. The issued is Credit Cards and we are not using them, and trying to pay them off. We are using cash only, and it makes a big difference in how we spend. We seem to over buy at the grocery store, and buy our toddler daughter way to much stuff. I am just looking for any advice and or tips on how you did this. We make a good salary, but have over spent. We are trying to get more connected to our faith, and trying to get our finances in order. God Bless.
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When my wife and I first married (second marriage for us both) we each brought some serious credit card debt with us. We determined to live on one income (mine) and use the other income to retire the debt. So - I paid the normal bills while she concentrated on the debt…We retired the entire amount in about 2 years.
A technique that we used to good advantage was to take advantage of credit card “introductory rates” on transferred balances. We had a many as 5 cards in action at once. We would transfer as as much as we were able to the lowest rate card(s) and then try to pay as much as we could on each one, naturally concentrating on the cards with higher interest rates in order to get those balances down as quickly as possible.
Of course this requires planning and discipline - something that it appears you and your wife are developing, so it should work for you if you chose to try this.

In so far as groceries are concerned…Always make a list and stick to it. Learn to enjoy simple foods and simple meals. Cooking rather than buying prepared meals, can save money AND can become a family activity - something helpful to the kids as well when they grow up.

Buying children too many things…Well you simply have to stop doing this. There really isn’t any substitution. Get more involved with them and get them more involved with you and the family - chores, cooking etc, as appropriate to their ages.

Hope some of this helps.

Peace
James
 
two words: DAVE RAMSEY. I also endorse him. we teach his Financial Peace University class at our parish. While his class system (FPU) can be a little costly to take, the books are available for free at your local library and his basic budget forms are available online at his website.

his system is this: live within your income, save for a rainy day, and for emergencies, use cash only, get ALL consumer debt except for your house paid off as fast as possible, take on extra work if needed to do that, extract ALL non-necessities from your life if necessary to get debt paid off.

like another poster said, it’s a simple formula, but it’s not always easy.

my DH and I have paid off about $60,000 over the past 3 years using his plan. we have about $30k to go. although we are getting there, we aren’t as focused as we used to be and have slipped a little on our snowball. but…like i said, we’re getting there!

our demons were also credit cards. we used them to pay for my fertility treatments, his graduate school, an entire house worth of furniture including pricey antiques, and a LOT of eating out. as a result, we got almost six figures of debt and we both gained about 40 lbs from all the eating out. we learned. we still like to eat out, but now we budget for it…
 
mkipp said:
My 3 year old now says “I want that.” all the time. I feel bad not buying her stuff
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There is a psychological side to money. I suggest in addition to the practical side of making a budget, tracking in Excel, etc, you get to the bottom of your feelings associated with money.

Why all the spending? What is it trying to mak up for? The book Shiny Objects by Dr. James Roberts might be helpful (bonus points for checking it out from the library instead of buying it)

Why do you feel bad not buying a 3 year old everything she wants? It is bad for our children to indulge them and spoil them. The books Financially Intelligent Parent and Silver Spoon Kids by Jon and Eileen Gallo might be helpful.

It is important to teach children financial responsibility early on-- starting around 4 or 5-- giving an allowance,requiring them to save to buy toys/treats at the store, etc.
 
twk001 said:
two words: DAVE RAMSEY. I also endorse him. we teach his Financial Peace University class at our parish. While his class system (FPU) can be a little costly to take, the books are available for free at your local library and his basic budget forms are available online at his website.

his system is this: live within your income, save for a rainy day, and for emergencies, use cash only, get ALL consumer debt except for your house paid off as fast as possible, take on extra work if needed to do that, extract ALL non-necessities from your life if necessary to get debt paid off.

…
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For after you’ve got your credit cards cleared up…

I don’t know how it would work now, but it used to be (when interest rates were a little higher) that if you made one extra house payment each year, a 30-year-mortgage would be retired in just shy of 20 years with a savings of about one-third 🙂 The way this can be done easily is if you are paid weekly, bi-weekly or every four weeks, you make the extra payment by simply using the same amount from the “extra” paycheck. If you are paid monthly or semi-monthly, then you just add in 1/12th or 1/24th from the paycheck into your mortgage payment.

Then of course when you have paid it off early, you just *save *the money you would have previously put towards your mortgage!

Also, there are “add-ons” included in your mortgage payment which can be reduced after a few years, for example, some types of insurance can be re-done so that that payment goes down (you don’t owe as much on the house, so you don’t need to carry as much life insurance), etc. (The same goes for your car payments–you can reduce the comprehensive insurance and eliminate it once you have paid the car off [while ensuring that you have some money to pay for a used car if your car is totalled].) Discuss with your insurance agent, while considering that they are paid commission!

And speaking of cars… if you still owe a lot on your car(s), sell, pay off the loan, and buy used cars, if that is possible. Even if you lose a little on the deal, the savings in interest and insurance might make it worthwhile. Be sure you have the car checked out well before buying it.
 
mkipp said:
I am the cook, because my wife is not the best in the kitchen. I do use a crock-pot, but we never seem to eat all of what is made. We throw out so much food it is sad.
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Why do you throw it out??? Leftovers freeze - they can be used for lunches at work (great way to save more money) they can be combined into a stew etc…There is really no reason to toss out food unless it has spoiled.
My 3 year old now says “I want that.” all the time. I feel bad not buying her stuff, but she plays with something for a day and then never again.
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OF COURSE a three year old says “I want that” all the time. EVERY three year old is going to do that.
BUT -
No three year old should control your spending habits. You are the parent and the boss and she needs to learn the lesson early that she does not get everything she wants. End of story.

Peace
James
 
Twice in this thread, you’ve mentioned overspending at the grocery store and throwing out a lot of food. This is pretty easy to fix. Every week, before you go to the grocery store, sit down and plan out all the menus for the week. Your menu plans should be realistic – and make plans for those leftovers. For example, if you plan to make a roast in the crockpot on Tuesday but you know that it will make enough food for two meals, then you need to plan to have leftover roast for lunch on Wednesday, etc. Menu planning can really cut back on the amount of food waste.

As for the rest of the debt – Dave Ramsey’s plan. His plan is not always easy, but it works.
 
Paying off a mortgage early saves much less today than it did when rates were higher. Refinancing to a lower rate ten year mortgage might be a good idea though, once the higher interest credit card debt is retired. Refinancing to take out equity and pay off credit cards makes excellent financial sense, but only if you are truly disciplined enough to not run the cards up again.

A lot of older financial advice, both on saving on mortgages and saving for early retirement comes from the days of double digit interest rates. Strange that only credit cards are still charging the same rates they were when mortgages were 13%.
 
JRKH said:
Why do you throw it out??? Leftovers freeze - they can be used for lunches at work (great way to save more money) they can be combined into a stew etc…There is really no reason to toss out food unless it has spoiled.

OF COURSE a three year old says “I want that” all the time. EVERY three year old is going to do that.
BUT -
No three year old should control your spending habits. You are the parent and the boss and she needs to learn the lesson early that she does not get everything she wants. End of story.

Peace
James
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I need to plan all meals before I go to the market. It seems that I always make way too much food when I use a crock-pot. I need to brown bag my lunches at work, I started today. I want to be able to pay off debt and save my money for our future. I hate having to worry about money, and having it cause stress. I guess I get too caught up in what everyone else is doing/buying. I want us to have a close and happy family.
 
mkipp said:
I need to plan all meals before I go to the market. It seems that I always make way too much food when I use a crock-pot.
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Yes - if you have a small family, crock pots are going to make way more than just one meal. But all that means really is that another night you won’t have to do do any more than just pop a leftover container in the microwave or oven and you have more time to spend with your daughter.
If what is left over is too small to make another meal, consider keeping a container in your freezer for these items. Just dump them in together…Bits of meat, veggies, even potatoes. Then you take this and dump it in a pot as a soup or stew starter (mulligan stew). By the time you heat it up, taste it and “doctor” it (as most cooks will do) no one will believe it’s just leftovers.
I need to brown bag my lunches at work, I started today.
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👍
You will be amazed at how much you can save by “brown bagging it”. For years, I carried a small cooler (like a “six pack” size) with a sandwich or two, some fruit, couple of drinks and a snack. I was never hungry…😃
I want to be able to pay off debt and save my money for our future. I hate having to worry about money, and having it cause stress. I guess I get too caught up in what everyone else is doing/buying. I want us to have a close and happy family.
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Yes - I must admit that I was fortunate to have been raised by people who were “children of the depression” and knew how to stretch a dollar - or a nickle for that matter. We did not get a lot of things…even a Christmas and Birthdays, but we never “wanted” for anything either.
As kids we “wanted” the stuff we saw on TV…but that did not mean we got it. My dad planted a garden and we worked in it - my parents canned and froze the produce. We learned some good lessons just from being around such a family.

that did not stop me from getting into some financial troubles when I was younger, but it gave me a good foundation to fall back on as I got older.
And you are right…getting caught up in “things” is just too stressful. Be simple and be happy. That is what Jesus wants us to know through the idea of not being “attached” to worldly goods.

Peace
James
 
Have you considered downsizing your house? Too many people are house rich & cash poor. The more space you have to “store” material items the more you are tempered to spend. When you live in a smaller space, each item you purchase makes you think, “where are we going to store this?” It also helps with hoarding issues.
 
Giggly_Giraffe said:
Have you considered downsizing your house? Too many people are house rich & cash poor. The more space you have to “store” material items the more you are tempered to spend. When you live in a smaller space, each item you purchase makes you think, “where are we going to store this?” It also helps with hoarding issues.
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We bought my wife’s grandparents home, and she would never want to sell it. We live in a beautiful ocean town, with a fantastic school system. We do have a high mortgage, but not terrible. We make over 110K together and have nothing to show for it, because of poor spending and credit cards. I feel that with hard work, and can fix this. I grew up lower middle class, and my wife grew up close to wealthy. I just want to not stress about money, and to be a close family. I realize now that “stuff” does not make me happy.
 
mkipp said:
We bought my wife’s grandparents home, and she would never want to sell it. We live in a beautiful ocean town, with a fantastic school system. We do have a high mortgage, but not terrible. We make over 110K together and have nothing to show for it, because of poor spending and credit cards. I feel that with hard work, and can fix this. I grew up lower middle class, and my wife grew up close to wealthy. I just want to not stress about money, and to be a close family. I realize now that “stuff” does not make me happy.
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Sounds like you are house heavy. If I remember right the mortgage payment should no greater than 25- 30% of your income … Add the insurance, taxes, utilities, upkeep (lawn, garden, carpets, repairs) this usually bumps house costs to 50%. “It’s my wife’s grandmothers home” suggests you are overly emotionally attached and letting this keep you from “simplicity”.

Still recommending you explore downsizing your house: sell, rent, exchange.
 
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