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  1. #1
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    Default Cash Only Budgeting

    I had mentioned Dave Ramsey's cash-only strategies earlier, and had
    heard from at least one other person who's doing this. Is anyone
    else using a cash-only system, and if so, how do you implement it?
    Do you have one cash envelope, or several? How do you classify your
    expenditures? How do you handle a trip to Wal-Mart that involves an
    oil change, diapers, a gallon of milk, and socks?

    My wife and I are butting heads somewhat over exactly how to make
    this work, so any feedback is appreciated.

    Thanks in advance,


    Vince
    From: "bootkiller" <bootkiller@hotmail.com>
    Date: Wed Feb 18, 2004 10:13 am
    Subject: Cash-only budgeting

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  3. #2
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    I do this too, and usually I will pay for it out of my grocery envie, then when
    I get home transfer the money back to the grocery envie from the other envis,
    i.e. car maint. food,
    Christy

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  5. #3
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    Vince,

    I use a plastic multi section coupon holder to hold my cash- one
    section per spending division...(hope this makes sense). I think I
    bought my coupon holder at Kmart or Walmart, but I have seen them at
    the one dollar store too. As far as multiple division purchases from
    one store, I guess you'd have to either use like a $20 from one
    section and then deduct the money from the other sections later to be
    extremely correct, or maybe keep small bills in the sections and if
    the milk is 3.00, the socks 2.00 or what ever, then take 3 ones out
    of the "grocery" section, 2.00 out of "clothing allowance"...just
    keep it as close to correct as possible. Maybe someone else has an
    easier solution.

    Lisa

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  7. #4
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    Vince,
    I use a combination of Dave Ramsey and Mary Hunt. I keep a specified
    amount for my "cash only" for groceries, food out, and gasoline. I
    keep specified amounts for car maintenance, clothing, home repairs,
    medical, etc. in a seperate checking account. If I were buying
    multiple "categories" at Wal-Mart or such, I would write a check for
    the car oil and socks. I would check out seperately for the milk,
    etc. and pay with cash. I know I do this with Christmas presents so
    I have an individual receipt for something if there is a possibility
    it would need to be returned and have never had a clerk complain.
    Because my "cash only" categories are so few, I never really have a

    problem with jostling the cash back and forth. If you try to make it
    a complicated, convoluted program it will be too frustrating and your
    wife will probably hate it and fight you at every turn, keep it
    really simple. That is my 5 cents worth! HTH
    SandyL

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  9. #5
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    WHere do I find info on these two people.I really need help with
    my spending and budgeting. the cash only practie seems like a great
    idea. Do they have any other good ideas? PAM

    http://www.daveramsey.com

    http://www.cheapskatemonthly.com I think

    I use a combination of both too. I save using the "Freedom Accounts"
    method.

    They also have books you can get at your library. Just look them up under
    "author."
    Lynda

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  11. #6
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    I found Dave Ramsey's books in the public library. "Financial Peace
    Revisited" is a very good book, and a quick read (probably because of
    the big type!). Dave Ramsey has a syndicated radio show, and does a
    lot of financial counseling and seminars through churches.
    Consequently, he tends to couch things in terms of basic Christian
    ethics, of tithing, stewardship, and debt as a form of servitude. If
    you don't have a problem with this approach, it works well. (Suze
    Orman takes a psychological approach to get to the same places.)

    Anyway, he advocates setting a spending limit for each major
    category: groceries, entertainment, car maintenance, etc., and then
    withdrawing that amount in cash. Each category has an envelope. If
    you go grocery shopping, you grab the grocery envelope. If you want
    to go out to eat, check the entertainment envelope. Once the money's
    gone, it's gone. This way you're spending real money instead of
    tracking figures in a check register. Makes you think more about
    what you're spending on, and how to stay within a limit.

    Then there's the debt snowball: First, build up a cash reserve of
    perhaps $1000. This is your emergency fund. Rank your debts in order
    of smallest to largest, irregardless of the interest rates. Make
    mimimum payments on each debt, and focus on paying off the smallest
    one first. This frees up cash. Take the minimum payment from your
    first debt, and add that to the minimum payment on the second debt
    until that one is paid off, and so on down the line until all you
    have to pay on is your house. He advocates getting mad at your debt
    so you'll pay it off faster. Right now we're in the process of
    building the emergency fund. I can't wait until I can start paying
    off the debts.

    Anyway, get to your public library and start looking. "Financial
    Peace Revisited" is worth the read.

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  13. #7
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    The big point of conflict is what is classified as what. I have
    postulated three categories: groceries, baby expenses, and mad
    money/entertainment. Under baby expenses I put diapers, wipes,
    clothes, toys, videos, etc.: stuff the baby uses that we don't. Take-
    out food or dinner at a restaurant comes under entertainment. My
    wife wants to put diapers and take-out food under groceries. She
    also doesn't feel comfortable carrying cash. She'd much rather use
    the debit card or checkbook. Of course, we've been trying that and
    it hasn't worked, for various reasons. I'm sure we'll get it worked
    out, but it's a little frustrating right now.

    THanks for all the input,

    Vince

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  15. #8
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    Vince,
    Perhaps you could have a "groceries/household" category--food at
    home, diapers, wipes, HABA, paper goods, etc. all the things
    necessary for running a household--then an "entertainment/family"
    category--toys, videos, take-out food, dinner out. I know for me if
    I lump take-out food into groceries, my grocery money is gone REALLY,
    REALLY fast! I think once she gets use to using cash it will be
    easier for her. Please remember she will only need to carry the cash
    she is planning on spending THAT day. If you have $400.00 to spend
    on groceries/household for the month you wouldn't have to carry it
    all with you each time you go to the store. Just take an estimated
    amount based on your shopping list. Of course you would need to make
    a list and stick to it. HTH
    SandyL

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