We Need Just a Little More Money!

Question: We never have enough money and always have a credit card balance. We’re constantly behind on bills. I’m thinking both my husband and I should get part time jobs on the weekend so we can finally get ahead. What do you think? 


Answer: Working more isn’t the answer. Working together is.

If you don’t have a system for managing your income and expenses, and a habit of regularly maintaining and updating your finances as a couple, the extra money you earn will just get spent or be wasted.

Try these three steps and let us know how you fare in two months.


1. Set up a budget. We have a whole chapter in our book devoted to establishing a spending plan that will work for you. If you work together, it should take you about a week to set up and start. Do it on paper first and after you’ve established the habit for a couple of months you could consider a computer-based budget. 


Read how our budget works in our book, America's Cheapest Family Gets You Right On The Money or in this blog entry, or in this longer article (for website subscribers only).

If you don't like the idea of paper budget, you might want to try a computer based solution that we think is the easiest to use and most like our "save in advance" budgeting system—read about Mvelopes here.

2. Save money without changing your lifestyle. There are many ways to save significant amounts of money that don’t require a change in lifestyle. Start by getting new quotes on your auto, homeowners, health and life insurance. Making changes in your coverage or changing your provider can put hundreds of dollars back in your pocket each month. We do this every two or three years and always save money—read more here.

If you both work on this it should take a month to review all the quotes and make some money saving decisions. You might also want to research refinancing your home and car (if you have a payment). 


3. Make a commitment to put your credit cards on ice. If you can’t pay off your balance each month, stop using your cards. Paying interest is a waste of money. If you both agree to this, you’ll see an immediate savings.

Working together as a team is the best and most rewarding solution. Make 2011 the year you learn to work smarter not harder.