Before my husband and I got on the same page about our money, there were times I couldn’t sleep because I was worrying. I was stressed out and grouchy because I felt like I couldn’t relax, because one of those figurative spinning plates would drop if I wasn’t 100% on top of things. I didn’t want to bring up the unplanned expenses that popped into our bank records because I knew it would lead to an argument. Things weren’t great.
Cash-based budgeting changed all that.
Once we started to get our finances in shape as a team, things improved dramatically. It’s better the first month, even better the second, and by the time the third and fourth month roll around, life gets a whole lot more enjoyable.
I can confidently say that using a cash-based budget makes my life easier.
If you start using one, I’m sure you’ll experience at least one of the pleasant side effects below.
- You sleep better at night. You’re not worrying about a check that has to clear, or whether or not your spouse went through a drive through or did some online shopping. It was budgeted and it’s accounted for. You know what’s in that account for the bills that are coming up.
- It makes balancing your checking account easier. Fewer transactions makes the whole process go so much faster. While I honestly haven’t “balanced” my checking account in years, I watch what’s in there, what transactions are recorded, and what the balance is. If something’s off, it’s easy to see where, since I don’t have a million little grocery, lunch, coffee and other transactions to wade through. That’s less stress and hassle in my life, and it’s 100% worth it.
- It’s really easy to see where your budgeting was a little “off.” No more money in that envelope/clip, but still have some expenses? You know where you either need to revise the budget or reassess the spending. The process is faster and easier next time, translating to more money and more time later.
- You spend less. It’s true! Studies show you spend less when you pay in cash than with a card. It’s more tangible, and the dollars feel more real, rather than just a number on a receipt. I don’t know about you, but having more money at the end of the month just makes me feel more secure.
- Fewer arguments. Maybe they weren’t arguments. Maybe they were “disagreements” or “discussions,” or maybe you just logged into the bank account and were quietly and unpleasantly surprised by how much spending had happened (whether you or your spouse), and how little there was left. Following through with a cash budget cuts down, if not eliminates, surprises – and the resulting “conversations” that happen afterward.
The transactions that show up in your bank account will only be the ones you planned out for the month – the utilities, housing expenses, etc. There shouldn’t be any stops for snacks or other random purchases. In our house, we carve out an agreed-upon fund for each of us, and we don’t have to explain where it goes. Unused money gets carried over into the next month, so if I find a fantastic pair of shoes or spot something else I want, my “fun money” goes to that purchase – supporting my fun. Likewise, my husband doesn’t feel bad about buying some funny t-shirt he found.
When we got on the same page about our finances and moved to a zero-based, cash budget model, it made all the difference in our house. Once you give it a try and stick to it for a few months, you’ll see it (and feel it) too!