Help with budgeting please!

[user1497106881]

Hi all,
I'm married with two kids and I'm really struggling to find a method of budgeting that works with my partner. As I'm sure you can imagine, this is leading to arguments and stress.

My wife has worked on and off part time for the last 10 years and brings in less than £800 a month. I run my own business, and make up the rest each month.

On paper, our out goings are (say) 3K, but we have trouble sticking with this.

When we go over budget, the onus is me to find the extra money from my company. This is a pain as I'd much rather create a buffer so that the next month's money was ready - rather than (as now) we tend to live month to month.

The method we've tried is this:

• create a spreadsheet of all outgoings
• create a set of separate accounts to help save towards things like Xmas, birthdays, DIY, emergency, holidays etc

My aim is obviously to build up money in these accounts so that we are planning a lot more and spending from what we have accumulated - rather than bouncing around in the overdraft.

Aspects of this approach has worked e.g. we take out £100 a week in cash for food, once that is gone, it's gone. Spending cash is a good way to watch where your money goes! We also did well last year saving up a chunk of money for Xmas.

We also manage to put a little bit of money aside for the each of us each month so that we can spend a little on what we like - allows you to escape the tyranny of the budget and to spend your bit on whatever the heck you want.

The problem is, in general, it doesn't really work.

My partner spends what she wants. Not in a crazy fashion - but there's never a thought of "Where is this coming from?", "How much can we spend at B&Q?' etc - it's just "well, we need this, so I must by it". It just reaches a point where she says to me "When can you put more money in?", and I'm increasingly find that unfair.

The really stress point here is that it is up to me to make up the shortfall. You might think that I need to put more consistently & I have done in but I'm loathed to keep on upping the ante each month unless it is in light of a controlled budget - otherwise, as a business owner, I'm not making hay when the sun shines. If I have a bad few months (as can happen), there are no reserves to draw on as we aren't really budgeting; and, when that has happened, I get "why aren't you paying money in?" - completely oblivious to what I've contributed to date.

I've tried to speak to my wife, but it's just the source of arguments. She doesn't understand my point of view that I feel this is unfair on me as I need to find the short fall all the time. She finds talking about money boring (as if it's something I want to talk about!) and gets defensive and argumentative about it. I've explained that if I did not work for myself, and had a fixed monthly wage (as most people do), we would have to find a way to resolve this. And, part of me thinks about doing just that to force the situation - i.e. with a fixed wage you simply can't find more money each month.

I'm sure my wife's money will improve in time, but I'd rather be in the position that, as it improves, we are spending it sensibly. At the moment it's chaotic, and stressful.

Any ideas?

What budgeting approaches work for you?

Thanks

J.

p.s. apologies for the long, rambling email.

So are you continually topping up the household expenses from the business? What does your accountant say about that?

What do you mean Ada? He might be a sole trader in which case there's no issue, he might be the ail shareholder in a LTD and just pay increased dividends or increase his drawings. As long as records are kept there isn't an issue, is there?

OP - your wife is being unreasonable and I speak as the lower earning partner who is a bit spendy.

This is how we do it and it works well.

We have a joint account for all joint expenditure - bills, mortgage etc. On a spreadsheet I list all of the regular payments plus other extra stuff for the coming month e.g. Ironing lady, gifts etc. And our total income. We look at what we want to save and transfer that to a savings account. Then the remaining surplus is split equally for personal spending. We have actual separate accounts for that so my personal spending doesn't touch the joint account.

If we genuinely need something unexpected it comes from either the savings or we split it and pay out of our surplus.

Works extremely well for us. The key was getting the accounts and spreadsheet right.

It seems obvious. Work out what you have to spend each month and stick to it. It depends on both parties understanding that that is all the money you have. It should not be difficult. I'm referring to situations like yours in which we are talking about sticking to a £3000 a month budget. It would be a lot more difficult to stick to say £700 every month.

In short, this would infuriate me.

Hi AdaColeman,
No, I mean I pay myself a wage and a dividend. The dividend then changes in size to cover the cover.

Moanyoldcow - thanks for that. How do you track that you are not over spending on (say) eating out etc? Is that all via the spreadsheet?

Riderontheswarm - you are preaching to the choir here! This is infuriating me.

put her in charge of the spread sheet? perhaps then she would see the way it works.
ask her how much she thinks is fair to spend ?

You need YNAB - you need a budget. It is brilliant. You can get a 30 day trial, then I think it's £30-40 per year. There is an app linked to it.

Have you looked into YNAB?

It sounds as if it would be perfect for you as you have all the basics in place. It's a web-based budgeting system that encourages you to "age" your money so that you're living on last months pay, and it comes with an app which your DW might find useful as you can see instantly what you've got available to spend in the B&Q category, for instance. If there's not enough there, you're forced to make choices about what else you'll spend less on if you still want to overspend in B&Q.

It does have a bit of a learning curve, and it does have a monthly or annual subscription, but I found it very useful to get my similarly inclined DH to think about spending in context of what else we needed to pay for.

Sorry, posted too soon.
We have used it for a while and our savings have increased massively, so it's worth the yearly cost.
You budget for everything. Of course, you then need to stick to it, but knowing you only have x amount makes that easier.

NormaSmuff - everything just leads to arguments at the moment :(

Look at the overall totals and if you've over spent on say eating out, then you have to cut back on something else. Have a goal of what you want to save per month and stick to it! Sounds over complicated with too many spreadsheets just have one sheet or a note book and pen. Lots of self discipline and agreeing up front so no one is feeling hard done by. If it doesn't work, separate bank accounts - one for household expenses, one for savings and individual spend accounts.

Great minds Squirrels

NoSquirrels / CaptainBraandPants

Thanks guys, yeah, I've looked at that before. It's just the learning curve that scares me - especially as we both need to be on board; I'm also looking at apps / approaches such as:
squirrel.me/
www.mvelopes.com/

..but it just needs to be 'simple' and for us both to buy into it

useretc how much does your wife need to buy into it? Tbh, my DH does nothing. He keeps his receipts (mostly) and I go on YNAB every day. It takes about 10 minutes a day, bit more on the first of the month as a lot of DDs on that day.
What he does buy into is the limit. So, if he is buying something biggish, will ask if he has enough in his budget, in the DIY budget, etc.

CaptainBraand

YNAB is good, OP. It really does point out where you need more money than you thought, and where you could save too. I found it useful because if I get my DH to sit down just once per month and help agree the budget, then the app sort of "controls" the day-to-day decisions so there's less of me being the bad guy. Takes the emotion out of it.

I'd be very nervous in your situation too - businesses/self-employed people need a buffer because of sick pay, drop in revenues etc etc

This spreadsheet malarkey sounds like a lot of work and effort, and doesn't actually change anything, it's just a very time consuming exercise. As you say, she doesn't stick to the budget, so regardless of how many hours you spent spreadsheeting, your bottom line will always be in the red.

Problem is she thinks you have a bottomless pit of money. You have given her this impression. Next time the money runs out and she asks when you can top it up say "not till 1st of next month - the constant monthly top ups over the past couple of years have bleed the company dry, I have no more reserves left". You need to be more firm and keep saying this.

picketfences:

"Problem is she thinks you have a bottomless pit of money. You have given her this impression."

Yes - I can see this :(

can you meal plan together/shop together?

NormaSmuff

"can you meal plan together" - the planning is the problem, it's tricky to agree anything without it turning into a massive fight. I'm not saying she is spending out of control, but there is no budget, so money just racks up...

We are in a similar position to yourselves, I bring in around £750 a month but only work 2 days a week. Husband works full time & overtime when available.

We don't have spreadsheets or a budget but what works for us is that my wages are paid into a separate account, DH's go into the joint account & cover all the bills, used for petrol & food shopping. We're part of a Christmas savings scheme so the direct debit (£200 a month) comes out of my account leaving £550 a month in there, then we use this account for days out, holiday savings & non essentials.

Works well for us but I suppose everybody is different

can you make her seem it is her idea somehow? or at least that it doesnt come from you?
just be straight with her, no raising of your voice. refuse to get into an argument an then she will be arguing with herself.

let her know at the beginning of each month that there is x amount and divided by 4 is x amount per week.

tell her you are really scared about the lack of money or something

We use Squirrel and it's been a lifesaver as it stores all the pots of savings for you.

I have 3 holiday pots running, car, various memberships so the money there when due, general savings and unforeseen pot.

I then pay us weekly spending money so it comes in once a week and never runs out by end of month!

NormaSmuff

"can you make her seem it is her idea somehow? or at least that it doesnt come from you?
just be straight with her, no raising of your voice. r"

Good ideas - as I'm sure you can imagine - tempers easily get frayed