What do ya'll think?
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| Wed, 01-19-2005 - 2:42pm |
Dh's bonus check came through, and it's fairly generous. Also, he has a raise coming through Feb 15. All wonderful things. My question has to do with how to allocate it, while taking dh's feelings into consideration.
Here's the thing. He has always chafed at the small amount of spending money he is allowed out of the budget, though he's been reasonably understanding about it too. But he was hoping for a large chunk of money out of the bonus and raise. I was originally thinking we would each take maybe $50 apiece out of the bonus, and then each get maybe $30 of spending money each month after his raise comes through (we currently each get only $10 a month, of which dh already spends $6 a month on xbox live). But dh seemed disappointed and unhappy with that, and so I asked him what he thought would be nice.
He said that he would like to have $300 EACH out of the bonus (which is more than 10% of the net) plus $50 each month from his raise.
I think we are probably going to do just that, but I wanted to run it by you all first. Here is what it would mean. It would mean that the bonus check would bring our contingency fund up to the $1000 we want in it until our debts are paid, pay us our allowances, 10% to charity (we always do this and it is absolutely non-negotiable--we are in agreement on that) and then have a little under $1000 to divide between saving for the trip to Colorado we have promised my parents we will make to see them and the beach vacation dh wants. No extra debt payment.
On his raise, it would mean an additional $100 toward debt each month, plus extra charity (we do not currently give a full 10% of our net income, but we are working toward that number, so each time he gets a raise, we allocate *more* than 10% of the raise toward charity), plus our allowances, and only another $50 to allocate among things like saving for our 10th anniversary (we want to buy new wedding rings--long story), improvements on the house, etc. And of course, dh has lots of ideas about all the things we're going to do with all the extra money (his raise is quite substantial, because he has been severely underpaid and they are working him up to where he should have been to begin with).
Anyway, it's funny because to me, personal allowances feel like "wasted" money, because they just sort of trickle away, without any appreciable difference in our lifestyle or net worth, and without any real building toward our big goals. But to him, the personal money is where it's at, it's what makes him feel good about working all day. It makes him feel like he's got something to show for all those hours. He wants to be able to go out with the guys once in a while and not have to say no because he doesn't have the money for it.
If we allocate the money like that, out of my allowance I will put $250 in savings out of the bonus, and $40 each month in savings. The only thing I will begin spending on that I do not currently spend on, is a proper haircut (currently I have friends do it) and to dye my hair (at home). That's where the $50 out of the $300 will go, plus I estimate $10 or so a month, on average, to maintain the cut and color (I'll color at home). Some of the savings I will eventually spend on plants and gardening necessities for turning our yard into our personal produce market :). But most of it, to be honest, I'm not sure what I would do with--I just don't really have any real "wants" beyond the big goal of having our little country homestead. So it will go in savings and some day I'll have a big chunk of change for something--maybe a potting shed for our homestead. LOL
Also, I have an additional "unbudgeted" income from my freelance work, which previously we were using for "extras" like buying the new stove, little bits of allowance, some extra debt payment, etc. Now, however, I am rolling that into my new business I've talked about elsewhere, so that source of spending money is drying up, for now (hopefully, once my business gets off the ground, it will quickly become a big source of income for us). So I am getting one big thing out of all this--my business, which is something I really want to be doing. And to dh's way of thinking, he is losing that bit of spending money. So I feel like he should be compensated out of the raise.
Anyway, I'm just wondering what you wise folks think of all this. Is it a good idea to allocate the spending money the way dh wants? He is open to compromise on this, but a part of me is hoping that if we do it this way, he will finally be happier again. He has been really nice about our tight budget for years, as we've worked our way out of the hole, but I know it chafes him. He loves to spend money! LOL
Another part of me is afraid that if he has all this money coming to him, he'll begin spending outrageously. He has a habit of always spending just a touch more than he actually has, which I usually cover him for (I know, I know, I shouldn't cover for him on it...). If he has $50 a month to spend freely, will he begin spending $65 a month without realizing it, and then end up having to have me bail him out?
Sorry for the book here, but I wanted to put all the details out there in hopes of getting your insight on the matter. Thanks in advance for any thoughts.
Blessings,
Heather

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I think $50 per month each is not too much. Is this on top of lunch money, or do you take your lunches? I bring my lunch but give myself $20 per week for 'things.' Sometimes it's spent on a soda here or there, and m&ms in the afternoon. Last night I spent $5 on dinner out with dd before her gymnastics class. Most weeks I can get to the end of the week with $10 left, but there are plenty of times it does all get spent. I think you have to be able to enjoy living, and that doesn't have to mean you go buy lots of toys you can't afford, but $50 per month is only $12.50 per week on a 4 week month. That is not very much at all.
As far as the $300 splurge, I think that is warranted too. But it's reasonable to say that if you agree to these, you don't want to cover any unbudgeted extra's. So if he gets the $300 and next month spends more than his $50, the shortage comes out of the following months allowance. That's fair and reasonable too, and all it's really doing is holding him to the committment you both made to keep spending under a certain limit.
Bonus & overtime....this is how we used to do it (until we could no longer meet our expenses...one we are 'caught up' we will continue this)
The person who earned it gets 30% of the net. The rest goes toward our current financial goal(pay down debt/savings/whatever).
Raises are considered household earnings, and doesn't go to the individual. It would go towards our finacial goal.
That being said, I think $10/mo individual spending money is a bit low. I personally think $50/mo is very reasonable.
We started this back at the beginning of our marriage as some of the OT of dh's was grunt work, and it was a great incentive to work OT and he could have his 'things'. Dh has always has more spending $$ as our own bonus/OT portions do not go to the other spouse. But is doesn't come out of our budget, and all it good. IT seems more 'fair' since the person doing the OT gets the extra. Really, it was to my benefit, too, as if dh had extra $$ he would take me out to dinner or something.
Works for us.
Sola
Heather, I don't really consider myself wise, but if I may I'll add in my 2 cents. In regards to how the money in general should be allocated I think only you and DH will really be able to make that decision because you know what your proirities are. Specifically, in regards to what you should do with your allowance, I think treating yourself to a nice haircut/higlights here and there sounds reasonable, if you can't think of anything else to spend it on then simply don't and save it for a rainy day. Just because you have it doesn't mean you have to spend it right. In regards to DH's allowance, be upfront with your DH and tell him you're afraid if you guys increase your respective allowances you will be tempted to overspend. Make an agreement that you'll both try it out FOR 3 Months (or what you're comfortabel with) and that if in that time you over spend you'll agree that the allowance has to be cut back.
I think this way it gives your DH room to prove that he's ready to handle his new budget limit and will make him accountable for his actions and consequences thereof. Put it in writing, sign it and then put it on the fridge (lol, this always works for my dh and me).
If for these last few years chafed or not he's agreed to live within a budget I don't see why he shouldn't be willing to compromise now or at least be given the chance.
All of this is just MHO though, and no one may agree with me and give you better ideas.
Good luck to you in whatever you decide and congrats on the bonus and increase in pay. That's always good news!
:)
Thank you both SO much. I really needed to hear this from others who are trying to get debt free. Now I feel freer to say "yes," which is what I wanted to say anyway. I know it's important not to live just for paying the debt--we do have so many other things we save for and do, but it's hard for me to let go of spending money, because it's not what *I* would do with the money. But I *need* to let it go!! And you have helped me so much.
As for the bonuses belonging to the spouse who earned them, we used to do it that way too. But now I am a sahm/wahm, and his hard work and late nights is extra work and late nights for me, too. Plus, we have never considered my freelance checks as mine alone, even though they are "extra" work over and above my work as homemaker and child rearer. So it seems fair that we treat his bonuses similarly. At the same time, dh's "extra" checks from mystery shopping (small checks, but there nonetheless) have always been his to spend as he pleases--I never even see them. So I feel like we're treating his bonus check very fairly, even though technically it's "his" check.
I agree that $10 per month is low. We had originally been getting $30 per month, but we agreed on the lower amount when we began saving for our house, and to help with the different budget when making the mortgage payment which is higher than our rent was.
But you guys have convinced me that I need to loosen my grip a bit, and let him have his fun. I'll be stashing mine away, and enjoying watching it grow, and he can go out with the guys once in a while, and we'll both be happy. :)
Thanks again for reading my tome, and for your great (and quick!) advice,
Blessings,
Heather
Thank you! This is excellent advice as well. We do well with written agreements, too, but for some reason it hadn't occurred to me on this.
I also have already told him that he needs to keep a buffer in his account, that I have access to. That way, there will always be a little money to cover him when he overspends, and he gets an opportunity to show that he's learning not to overspend.
Yes, he is very open to discussion on this. In fact, the only reason I even know what he wants is because I asked. He would have just gone along with what I planned for everything and not said anything (but of course, I recognized his long face and knew he wasn't happy about it). He knows that I am really good with the money, and he is very cooperative with whatever needs to be done to meet the goals we agree on.
So now I feel good about letting go a bit and giving him some room just to have fun. He's been such a good boy LOL.
Thanks.
Heather
I think it's ok to let your Dh have his $50 extra money each month. In years past, I know my Dh has felt bad when he could never pick up the tab at business dinners or just pay a drink tab when the guys from work went out together. So, when he received a large bonus a few years ago, we got him some new clothes and set up a cash fund for him to be able to go out and have fun once in awhile. He said he felt proud to be able to take his friends out once in awhile.
Pat
In answer to your question, he takes his lunches. Yet another point in his favor--and he's really nice about it too. His company takes him to lunch about once a week, though--he usually puts it on our credit card and gets reimbursed (it's a zero balance card, so no interest), which is how I know it comes to about once a week.
Anyway, thanks again for your response. I feel good about this.
Thanks.
Heather
Yup. Dh's co-workers all think I'm the queen of stinge, because he never has spending money and is afraid to go out for fear he'll spend money he doesn't have. LOL I know it will feel good to him to be able to go out once in a while and maybe even pick up a tab. Besides, it will be good practice for him to learn to start budgeting, if he actually has money to budget.
Thanks for the input.
Heather
Heather,
I think you are doing a great job. I agree with lovechrisngeorge. Believe me (you read my "Re-evaluation of debt situation" post), I know how easy it is to want to put everything into debt.
Again, you are on the right track. Doesn't mean that each month, you have to spend all your allowance money.
Enjoy alittle. I'm trying to learn how. LOL!
MYM
Thanks MYM!! I did read your "re-evaluating" post, and I meant to respond but seems I always got caught up in something else. I want you to know that I am *SO* impressed by how you are doing. You seemed discouraged in your post about re-evaluating, but I think it is quite impressive what you have done. You've been through so much, and I'm glad you're learning to have a little fun, too.
Thanks for the encouragement.
Blessings,
Heather
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