Money Matters
hordol
member
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Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Advice for how much of our leftover money to budget where?
I was just wondering if I could get some advice about what you guys would do in my situation.
After paying all the bills/buying food/other living expenses, etc, DH and I have some money left over. Yay! We don't have much of a savings right now, just a few thousand (cause we just got married and paid for a lot of it ourselves, plus I'm a teacher and my school doesn't pay me in the summers, so I have had to use some savings to help with the bills this summer.) That leaves us with about 3 grand in savings, and that's it. Once the school year starts and I start getting paid again, we should be able to build that up more quickly.
However, DH and I can't decide how much of our leftover money each month should be dedicated to savings vs using for fun stuff (for example, we would love to be able to take a European vacation before we decide to start having kids. DH also really wants a big screen TV for some reason 
lol) I tend to be more of the "saver" in the relationship, so I want to build that savings account high and build it fast! DH likes buying stuff--he still prioritizes savings, but would like to put less in savings each month so that we can "live it up."
lol) I tend to be more of the "saver" in the relationship, so I want to build that savings account high and build it fast! DH likes buying stuff--he still prioritizes savings, but would like to put less in savings each month so that we can "live it up."I'm trying to decide what a good balance is. I want to "live it up" too, but I want to be responsible with our money and not blow it on stupid stuff.
How do you think we should split our leftover money between savings and fun? What would you do if you were in our situation? We will have about 1500 leftover after expenses.
Re: Advice for how much of our leftover money to budget where?
Is a 12 month salary payout not an option at all? If it is available, please do sigh up for the 2013-14 school year.
First fund your emergency savings to 6-8 months EXPENSES.
Fund both retirements (if you have option for 403b - use it) AND fund a ROTH IRA
Allow some money each month in the budget to save for luxuries such as expensive vacations and big screen TV - but that is AFTER the E-fund is fully funded. (Divide the cost of the vacation by 12-24 months depending on your time line)
Include a personal spending line where you each get an "allowance for personal, non accountable spending -- or saving)
A good book to read is Smart Couples Finish Rich by David Bach. The first few chapters are question and answer exercises you do separately and then share. The discussions will help you understand each other's emotional relationship with money (what that TV really represents, why living it up is important to DH etc) which will facilitate setting up a budget that works for you both.
You do not mention debt --- if you have credit card debt--pay that off before either big vacations or a big screen TV.
I guess I was just wondering if it would make sense to set aside a few hundred every month to save for those big "fun" expenses.
Yes, AFTER you have the e-fund taken care of.
You can always cut back on eating out and entertainment if your DH is in a hurry for that TV. And of course - save and pay cash for it.
Make sure your budget is allowing for savings for vehicle replacement, medical co=pays & deductibles, clothing, personal care, gifts, etc.