Andrea, you have quite the system for keeping on budget. I wonder if you could share some tips for how you allocate your money each week, maybe even just as a percentage of income. I know some people pay twice a month into an account that they then use to pay off debt. How do you do it? 

You also mentioned that you hardly go out to dinner, so a birthday surprise would be a restaurant. I loved that. It goes a long way toward saving, little choices like that. I know you have, is it 4 children? Talk to me about food budgeting and making sure you have their expenses covered. Do you estimate what they will need per child per month? Kids have a way of needing things you never thought of. Thank you for sharing your experience!

Hey Shea, thanks for the note and for your inquiry.  When it comes to money management and our household, we try to make things as simple as possible.   As mentioned in my story about becoming debt free, we keep only the bare minimum of accounts - one for the household and hubby has his business accounts.  By maintaining certain balances in them, we're able to enjoy the lowest monthly fees with a buffer of three months of living expenses in the household one.  I'd like to get that to six months for some added security (you just never know).  

We max out the RRSP's and RESP's for the kids (I'm not sure what the American equivalent of these would be), but we do that once a year as opposed to monthly. There is so much out there about saving and how to best do that, but we're very conservative and opt for no-risk/low-risk investments.  Robert Kiyosaki's written a couple of interesting books about investing.  I've actually seen him speak and much of his teaching goes against what the banks recommend about diversification.  

I'm in charge of the groceries and any attire the children need.  I get the groceries once a week and opt for the 'alternative' brands over the brand names to save a bit.  I also try to get our household staples when they're on sale and stock up our storage room/fruit cellar.  We NEVER ever run to the corner store for milk/bread and we actually make our coffee at home in the morning as oppsed to grabbing our daily caffine fix from the coffee shops (another budget killer, those are).  

Just a note about the restaurants.  Our birthday dinner for the twins with all six of us the other evening was $85.  Tipping our server put us over the $100 mark.  I feed our whole family for a week on about $130.00.  It just doesn't make sense for us to eat out that much.  Also, the school offers the children pizza on Fridays and milk throughout the week.  Every now and then, the local diner will cater lunch for the kids at the expnese of us parents.  The pricing on all those 'extra' items is crazy.  We sat the kids down and explained to them that they'll have their milk here at the house and I send water in their lunches and Pizza night is Fridays here at home.  Wimpey's doesn't bring food for our kids at school.  I'd rather save the funds and send the kids to school with a healthful lunch that I've prepared for them.  I'm sure it's a bit challenging for them on those days when the majority of their classmates are chowing down on a very yummy smelling burger, but I just think they don't need all the extra fat/calories at school.  

There are other things that we do too... we only buy clothes for them when they absolutely need them - as in, not necessarily just because school is starting.  With three boys, anything that's not worn out is passed on down.  If it fits them, it's theirs.  Same deal with school supplies.  The ones from last year still work fine in September so they don't get replaced with new stuff just because it's a new year.

For my daughter's winter jackets/boots, I'll choose a colour like red or navy blue so it can be passed to her brothers.  I know she'd prefer pink or purple, but sometimes, these lessons need to be learned.  I wouuldn't say we estimate, we just make do with as much as we can and everything extra gets thrown on that line of credit so we can get it down.  That's our focus.  Hope this has answered some of your questions and thanks for reading my novel again.    

With four of them, we've had to make some tough choices, but I really think that they are better for those choices.  

Just a note about the coffee... I don't know what it's like down where you guys are, but up here, people are seriously addicted, (I mean crack cocaine kind of addicted) to Tim Hortons coffee.  Friends of mine will seriously purchase between two and four cups of these a day.  My own sister gets her tea from there (yes, just regular tea) at least twice a day.  When I extrapolated that out over the course of a week or a month, the expense was over the top.  When I was working in Toronto, I'd usually have three a day plus purchase a pop at lunchtime to take with me back to my desk for the afternoon.  I couldn't believe the difference in the monthly budget just changing the beverage habit made.  Just little changes like that will make a huge difference in the bottom line at the end of the month.  

Those sound like great strategies.  I'm wondering about #1 and #2   ~    Or, maybe it's open for some interpretation. 

The 'savings' of 10%, is that for nest egg type savings, or are you paying yourself for current enjoyment?  Or, #2, is current enjoyment and/or nest egg part of your expenditures?

Is there a more thorough explanation of those?  As my credit card is slowly lifting (hopefully by end of June/beginning of July), I'll be re-working my budget.  There's still more debt to be paid but we wnat to make sure we don't have to use credit cards again so we want to make sure we're 'paying ourselves' enough to enjoy life as well as pay off debtors...

Hi Zin - it's great that someone actually read through all that.  Thanks for stopping in.

After reading the book, it's clear that that 10% is not to be touched  - it's savings for your estate - as in, it's invested and gaining interest to build your wealth.  Clason, and Kiyosaki for that matter, also recommend investing in something secure and stable that will see continued steady growth - even if it's small growth - security is better than risk.  All other expenses are to come from 90% of your combined earnings - whether they are for necessities (mortgage/rent/food/bills) or desires (entertainment/vacation).   That reserved 10% is not for enjoyment purposes - it's for creating wealth.  They both also strongly recommend focusing on having zero debt - consumer or otherwise.  Yes, the book goes into much greater detail on all of those points.  I just put in an overview.  It's a pretty quick read, the principles are simple but invaluable and the lessons are the same ones I applied when I was trying to get myself into a more secure financial position. 

It's awesome that you've adopted an 'eliminate all credit card debt' philosophy and fantastic that you've been able to make such significant headway with your goal too.  I can't say I know many people who can make the same claims.  I hope you'll be seriously celebrating your accomplishment.  Once all your consumer debt is done, you'll be able to rework your budget to be able to make some significant strides to the other big-ticket things you may be talking about with the other debt you mentioned.  

I hope you'll keep us posted on your prgress along the way.  Robert Kiyosaki has written some great information about creating wealth too.  He's written a couple of books, but if I had to boil it down, the main principles are the same: pay yourself by investing in something secure.  Protect your money - absolutely do not risk the principle of your savings.  Get out of debt.  Own your home.  Become a business owner. These were his recommendations too but balancing that with spending time enjoying friends and loved ones and persuing our hobbies and finding enjoyment daily has to be part of our lives as well.  It sounds like you've got a good handle on it too.  For us, we still have the LOC here, so we still consider ourselves on a very tight budget.  To do that, we just stay mentally broke.  It doesn't matter to us what's in the bank - 'we're broke' until the LOC is done.  Given that mindset, we really think carefully about how our resources are spent and if we're receiving a good return on that expenditure.  I hope this is helping a little.  Let me know your thoughts and if applying the same principles will work for you too.

 I'll buy and open champagne when you are debt free!

 Awesome Marsh!  I look forward to that!  I'll have to hold you to it somehow, lol.

Believe it or not, we've made some serious progress with this goal over the past few months. Frank's business had a fantastic year after splitting from his partners a year ago and striking out on his own.  We've recently hit a rather large speed bump though and his income is about to seriously slow down.  Puts a bit of the pressure on me for mine to speed up a bit as our youngest of four head into school full time in a couple of weeks.  Yikes... I need to get busy.    

Hi Andrea, I just wanted to check on your other goals in the midst of your current family situation.  I hope you're still able to continue with this pay-off - even if you're chipping away more slowly at it, as well as some fitness goals - even if it's just a walk in some fresh air now and then. 

Hi Zin, thanks for checking in.  It's so nice of you to think to check and in all honesty, the notification that came to me for your post here kind of sent a message to me about how much I've been letting the ball drop on all the other things that were going on in our lives before this tsunami hit us.  Unfortunately this crisis has completely knocked us out of the 'saving' game for now.  Between the two of us, we have three businesses, but mine was just in the process of being set up when we got the devastating news and since then, everything seems to have happened so quickly.  Worse still, it all seemed to be headed in a very bad direction fast as we were getting blow after blow regarding Frank's prognosis. All of our energies went directly into survival mode.  Between the trips to the hospital, the hospital stay, the kids, the meds, the emergency rooms, doctor consultations and trips down to Toronto to meet with even more specialists, the house... I wish I could say I've begun to take on clients for my coaching practice, but I've fallen behind with that too.  Honestly, it's amazing I've been able to sort through all the forms, paperwork and applications for disability insurance and medication approval.  It's been a crazy ride, but you are absolutely right... Cancer is a word, not a sentence and I need to get my butt in gear and start becoming more productive, more focused and get back on track.. Thankfully, a financial fall-back plan had been put in place some time ago and we have savings in place for an emergency to cover expenses, but we'd never anticiapted an emergency quite so all-encompassing.  With Frank being the sole family earner, everything has come to a stand-still with this goal.  I needed this wake-up call.  Thank you sooooo much.  Re: the fitness goals.  I actually got dressed into my work-out clothes today with the intention of working out once the nurse left.  Just after lunch, the phone rings and I had to pick up one of the kids from school (looks like he has a flu).  Man, things really do have a way of getting off track.  Hoping to get outside for a walk tomorrow once the bus pulls away.  Hoping all my kids will be on it.    

Starting to work on this goal again.  The end of the year is fast approacing and we're trying to get the limit down to below a certain point.  Of course, it's also Christmas time so.... budgeting is vital and sticking to it, even more so.  Wow, I just re-read that Oct. 27th post and realize how 'in the woods' we really were then.  Thankfully, we seem to be through the worst of it now and on a path to a better place.  I'm so looking forward to re-establishing some normalcy around here.