Back to the Basics Using Cash

I am a big Dave Ramsey fan and started using a cash only system. I was already doing a cash envelope system before I read his book, The Total Money Makeover, but I became more disciplined after reading. It's rare in today's world to find a financial book telling you to use cash only and no credit cards. After we dug our way out of debt, we swore off using credit cards forever. I was very happy that he felt the same way he did about them.

The main reason I like using cash is once it's gone in a certain envelope then we stop spending for the month. I do over budget in our food envelope for those great sales. On average we spend $250-300 a month in food. It was closer to $200-250 for a family of 3, but with costs on the rise then I upped our budget. I also had to increase our budget for gas. It was a $100 a month but not it's up to $150 so not terrible but not having debt does make it easier to swallow.

We have $1200 worth of expenses monthly which includes everything from food, gas, utilities, gifts, household items, insurance, clothes, gas, and spending money. We put about $1,000/mo in savings. We have different things we are saving for like newer car, repairs, vacation and remodeling for the house. I have it marked how much money is in each category.

The main concern I hear is what if I have an emergency? That is why you put 3-6 months of living expenses into a liquid account so you don't need a CC. I have a debit card linked to that account as well as checks so I don't have to walk around with thousands of dollars on me. That's the other concern I hear often. I might get robbed if I carry cash. I never walk around with lots of cash and most of the time have $5 or less on me. When I do plan to shop then I bring a certain amount with me and sometimes a little extra so I get take advantage of an unadvertised deal.

The Little Things Aren't so Scary Anymore.....

Let me start off by saying that hubby & I used to be in financial straits. We slowly climbed out of that mess and am now Debt Free including the house! I don't share this to sound like a braggart, but I am very proud of what we have accomplished in the last few years. We are still relatively young, early 30's, so we are looking forward to really building our retirement fund.

Hubby stopped at a store on his way from work today and the truck just wouldn't start afterwards. So he called me to let me know and even tried jumping it but no luck. He just happened to be near an auto parts store. One of the guys looked at it and told him he needed a new battery. He gets a new battery installed, and it was $70 w/ tax. Not cheap but not as expensive as a new starter or alternator. We had the alternator rebuilt about 3 years ago so he got a little worried.

A few years ago that $70 would have been a big deal to us because we really lived paycheck to paycheck. It really hurts not to have anything in savings for these little emergencies, but it really hurts for the bigger $500-1,000+ ones. I have several books that I really enjoyed reading and my two favorites are The Complete Tightwad Gazette and Total Money Makeover. They have both helped us, and as I said in my title the little things aren't so scary once you have money saved up for them.