As a single parent, not knowing what was left in my account was just as frightening for me as not having enough. I mean, what is the difference? Both tug on the same nerve ending. There simply isn’t enough to be said about recording income, expenses, and savings on a regular basis.
I decided to approach this as a “Business Woman.” Tracking two and three incomes and countless expenses, I had to sit down once or twice a week and record what I had made and what I had spent. Sunday afternoons (or evenings) became my best time to review. I would log everything into a DOME taxkeeping record, because I didn’t have QuickBooks or even a nice computer to create excel spreadsheets.
However I got my Balance on paper, the sense of control in knowing exactly what was coming in and going out was empowering. I no longer found myself arguing about whether to stop for that $4.00 cup of coffee. The money was either there or it wasn’t. I had gotten brutally honest with myself and QUIT Spending Money I did NOT have.
Though very little accumulated in my savings account, I still maintained one to collect extra dollars each month. Each month I would clear about $2000. from my paycheck, another $400. from piano and voice students, and occasionally an extra $50-250. playing musicals or weddings.Taxes and insurance were withdrawn from my main paycheck, but I had to calculate tax on the extra income.
First, I told myself my real primary income was only $1800. I had that amount auto-deposited into the primary checking account. This covered my mortgage, car payment, which were set on automatic debit; paper checks written AHEAD of time for utilities, insurances, groceries, and a few credit cards…?
OF COURSE IT WASN’T ENOUGH!
Second, I had $100. per paycheck deposited into a Savings account that I could pull emergency funds from and cover VERY possible overdrafts from checking. This account is where I tried to deposit most of my $400+ of Piano and Music income. As a single parent, too often this money had to go to Primary Checking to cover unexpected items. At least, the students were pretty steady so the money was there.
Simply getting it all out on a spreadsheet (QuickBooks,etc) kept me empowered to take an extra job, work and save ahead for holidays. Notice, there was no “vacation” in that list. We got a neighborhood swim club pass each spring. If I got enough back from income tax, we bought a summer pass to Busch Gardens. We lived the life! Without all the pizazz and debt.
Not glamorous. Not a lifestyle you’ll want to ride very long. But the advantages? For once you’ll finally know where every dollar is and where it is going. You’ll also have a realistic alert for up-coming bills and know when you won’t have enough. That is NEVER fun, but you will be able to save ahead, adjust expenses before the crunch, and avoid hanging your Balance with a short financial rope.
Related Articles for Money Management: