Sorting Your Money

Terry J. Rigg For anyone that is familiar with The Complete Budget and BillOrganizer, http://www.homemoneyhelp.com/BBOonline.html you already know that I recommend that you use your checking accountto pay bills and cash to cover your household expenses.

With all of the different items that the average individual orfamily spends money on, it can be difficult to keep it separated. You have to have money for groceries, car gas, school lunches, Groceries, Dining Out and Entertainment just to name a few.

You could buy a box of envelopes each payday and sort the money on payday and stuff the money in an envelope until you need it. Of course, then you would have to have a safe place to keep it.

If you like the envelope method, then by all means use it. However, the entire purpose of The Complete Budget and Bill Organizer is to simplify things. Sitting down at the kitchen table each payday and sorting cash is far from simple.

It would be much better to try storing it in your wallet or purse. You would have the money when and where you need it. There is an element of risk that the money could be lost or stolen. If you don't feel comfortable with having that much cashin your wallet and don't have problems handling your checking account, you could deposit the money for groceries in your account and write a check for your normal grocery shopping. I wouldn't write a check for just a milk and bread run.

For a family, a budget keeper should be assigned to sort the money. They would be responsible to distribute the money to other members of the family. To do this you will have to clearlydefine who in the family is responsible for what expenses. Let me give you an example:

A family with a working dad and a stay-at-home mom with threeteenage kids may distribute their money like this:

Household Income after money for bills is deposited in checking: $500

Mom is assigned as budget keeper and keeps $355. Out of this money she is responsible for buying the groceries, health items, cleaning supplies, the families clothing, school lunches, pay the paper boy and other expenses around the house. Mom takes $50 out of this money for herself that she doesn't have to account to anyone else in the family for.

Mom gives dad $100 of which he is responsible for paying for hisexpenses to get back and forth to work including car gas. Dad can use $50 of his money that he doesn't have to account to anyone else in the family for.

Mom gives each of the three kids an allowance of $15. This money can be used any way they choose.

By sorting your money this way, each member in the family can keep the money in their wallet and all of the responsibilities are covered. No, you won't know exactly how much you spend each month on groceries, car gas, etc. The main point of a simple budget is to make sure you have the money to pay everything without the hassles like sorting your money into envelopes and accounting for every penny.

Mom, as budget keeper, would also be responsible for keeping thebudget, paying the bills and depositing money in their savings. This does seem like a lot of responsibility for just one person in the family but, to ensure that their finances are organized and everything is covered, it is absolutely necessary. It is also important to make sure dad knows how mom is handling thingsso that he can step in if the need arises.

While developing your budget using the Budget Worksheet you willknow what your household expenses are. Simply take that list andassign it to a member of the family along with the money to coverit. If you run into problems and somethings aren't being paid, you will probably have to review your budget and reassign theseresponsibilities.

ABOUT THE AUTHOR

Terry Rigg is the author of Living Within Your Means - The Easy Way http://www.homemoneyhelp.com/ebookadpage.html and editor of The FREE Budget Stretcher Newsletter and Budget Stretcher web site http://www.homemoneyhelp.com. He has 25 years of experience counseling individuals and families concerning their personal finances.