Debt Free - how to stay that way??

[dejags]

Any advice for me wise mumsnetters?

We have just sold our house and for the first time in as long as I can remember we are debt free. Hallelujah!!! .

The house we are emigrating to is mortgage free, so for the first time in our adult lives DH and I will not owe a penny to a soul. The problem is, is that DH is TERRIBLE with money. He doesn't have a clue about managing finances and if I dropped dead god knows what would happen.

he is happy to spend, spend and spend - opening credit cards and store cards without ever giving a thought to repaying them until the debtors start knocking on our door.

We recently had a massive argument about this and he has promised to mend his ways but I just don't see him sticking to it.

How do other couples manage their finances - I personally think that separate bank accounts when you jointly own a home and have two children creates more work than it's worth. What do you think?

First off, congratulations!

Top tip from a friend who was lousy with money. Freeze your credit cards is a damn big block of ice. That way, you have it when you realy need it but it stops impulse buying.

Have to say we've gone the separate bank account route! We pay a pre-worked out sum into a joint account for mortage, school, food, savings etc. This should be back to zero at the end of the month and what's left from our salaries is ours to fritter away without recrimination. In practice i buy clothes for DD and he buys "things" that apparently make his life so much better...

Firstly, congrats dejags. You are in a very enviable position.

I'm with marialuisa on this one.

We have separate bank accounts and a joint bank account for bills. Set amount paid in every month so that bills are always covered.

No credit cards, no loans, no HP or credit of any kind. We may not have much money, but the only thing we owe is the mortgage and that's a damn good feeling.

Also we both keep separate account balance spreadsheets for our personal bank accounts and debit things like birthdays, hair cuts, days out etc at the beginning of the month, so we know exactly how much 'disposable ' income we have. You have to make sure you keep it up to date and remember to put on any cash you take out.

Also, if you plan in advance for big things (e.g. a friends wedding) you can put a little aside every month and buy the pressie with cash up front. Same goes for holidays and Xmas.

Good luck...

BR
PS. If you're worried about your DH, can you make him leave his cards at home? That way he will always have to come home before buying anything/opening a card etc.

Have you thought about using something like Microsoft Money? We use that, it takes a while to set up but once it's going it's easy (our current account downloads directly onto it) and it does help to keep track. Sometimes it makes me feel really anal but the flip side of that is you can see exactly where you money is/has gone.

We have joint accounts but I think it's a very personal thing. I don't know if I could have a joint account with someone whose attitude to money wasn't very similar to mine...

I was terrible with money before I met DH - never opened bank statements (too scary), had every store card known to man and my overdraft was massive. DH is very prudent and mended my terrible ways but have found that staying out of debt is strangely addictive. We also use Microsoft Money (DH loves it as you can imagine) and I really would recommend it as a way to stay on the straight and narrow.

Wonderful feeling isn't it? We too are debt free. Here's how we keep it that way.

Joint account for bills, personal accounts for treats, presents and personal items. Having money that is yours to spend as you like without jepordising family finances is empowering. Dh is a stay at home dad, so every couple of months I transfer some money into his account. It's his for beer, CD's, gigs, clothes, presents and general flittering away. There are no arguments about what he's spending because I don't monitor it. Equally what I spend my money on is my business.

Any spare money, tax rebates, bonuses, refunds, birthday cheques, child benefit, dividends etc go into a 60 day savings account. On top of this, every time our accounts go over a certain amount (in practise for us about a month's salary spare) we siphon it off into ISAs. The 60 day account is used for getting over humps in financial planning i.e. the month council tax, car tax water bill and dh's birthday all come due. We also fund holidays out of this account.

Credit cards are the devils plaything. If the head of Barclay's bank won't have one I think this is a pretty powerful message about just how much they cost. Same applies for store cards, though if you MUST have one, I like the icecube trick. If he insists on having these cards, it might be worth sitting down and working out, before you buy an item, how much it would cost in the end to buy it using different methods, cash, credit card, store card etc. Seeing the figures in front of you can be quite a shock. You will find it is cheaper to liberate money from your savings account, even accounting for no notice peanalties.

A tip from my FIL, put into a savings account what you WOULD have paid on the mortgage each month. Now personally, I think it should not be quite as much, otherwise, where's the fun of being mortgage free?

I want to be debt free!!

Well, there is no chance of me being mortgage free but I do have about 6k on credit cards which I would love to get rid of?