Some financial know-how, please

So I finally convinced the hubby that I should take over the finances. We have separate bank accounts, our own bills, etc. In short, I have no idea just what I am getting myself into. I have until the end of June to show my prowess in all things money.

HELP :eek:

I can manage my own, but I am daunted (to say the least) at the prospect of managing someone else’s as well. So I am asking for any and all wisdom you Dopers wish to impart, as well as recommendations for books and websites. (Nothing too complicated though, okay? Remember, it’s just household finances we’re talking about here, not stocks and bonds and all that other stuff).

Depends on what you’re looking for. Getting out of crippling debt? Building some small savings? Looking to buy a house? Budgeting because one of you is going to lose a job? Doesn’t sound like you’re trying to make a lot of money, so that’s easy enough.

Given the amount of views and only one response, I think you need some specificity.

I will give you three general rules though:

1: Put 10% of your take-home pay into a savings/money market/bond account. If you can’t afford that, cut out expenses until you can. I’ve met very few people who, for medical, etc. reasons, cannot do this and every financial planner I’ve talked to/decent book I’ve read has mentioned this. If you can afford to put away more, do it.

2: Nobody cares as much about your money as you, so if you get a suggestion to do things, you better make sure that you understand why they recommend it and what it will mean for your situation. You’re not going to get any refunds on doing something stupid/because you didn’t understand, so you have to be willing to take responsibility for anything you do. Money’s a great objective way of keeping score.

3: Don’t listen to idiots on the internet.

Oh, I thought of 4) Get a copy of your credit report and see what it says, there are dozens of threads on how to do it/what to do with it.

Assuming you aren’t living paycheck to paycheck, my advice is to invest the time into setting up automatic payments for most of your regular monthly bills. If you add up all the time it takes to write checks and pay bills, not to mention the stamps, the time to physically mail out your payment, and the penalties if you forget, it will seem like a bargain to spend a little time setting up bill pay.

Just start by making a list of all your monthly bills, utilities, insurance payments, etc. For each one, call up the company and ask about all their auto pay options.

A surprising number will take credit cards, even Discover (pump up your cashback bonus). Otherwise, go with automatic bank draft, if possible. As a last resort, look into bank auto-pay.

Once this is all set up (can take months to go into effect, but worth it), don’t sit back on your hands. Use some of the extra time you have to check over your records each month to make sure no mistakes happen. It’s easier to ignore finances completely when things are automatic. Be sure to keep good records.

My husband and I used to have seperate accounts and we divided up the household bills. We just got a joint account recently and decided I would handle the finances and pay the bills. Aside from the regular household bills the only debt we have is our vehicle payment so that’s nice.

The first thing I would suggest is to make yourself a budget. I used this site to help me with ours. I know how much money we have coming in each month and how much is going out in bills each month. I have a bill organizer with individual slots that’s numbered 1-31 and I put the bills in it according to the date they are due. When a bill comes in the mail it immediately goes into the organizer. On Friday I will usually pull out the bills for the upcoming week and write out the checks and mail or drop them off as they come due. I also pay some bills online or over the phone.

Since I’m the one who knows how much money we have I do all the grocery shopping and am usually the one to buy the extras for the house. My husband has his own checkbook and he just puts his weekly allowance in it and that’s money he uses for the following week. (We each get a weekly allowance)

It seems like a lot of work sometimes trying to keep track of all the bills and everything but it’s been working out so far.

I’d say you need to have at least one specific goal in mind. Then take thyself to The Motley Fools have advice for anyone at any financial stage in life, including advice on buying cars, insurance, investing, 401(k), getting out of debt, etc. etc. etc. I think that site has all the information you could possibly need.

Is it just me? I’m a little baffled at why this is a big deal. You pay yourself first, (savings, investments, whatever), you pay your bills. Anything left over, you split up evenly as play money. Why is this so complicated? If you had no trouble managing your own bill paying, what’s the big deal now? (Now, if one of you has been slack and you’re in a bad credit rating sort of situation, I can understand. But you made it sound like the simplest possible financial situation.)

Pick up Financial Peace Revisited by Dave Ramsey (should be at your library by now). There’s a lot of good information in there. Dave’s stance is that you & your spouse should communicate and handle finances together; both people should know what the financial picture looks like, and both should decide where the money goes.

Thanks everyone for their replies :slight_smile:

Reading some of your responses, I realize I should have mentioned several things: My husband has a great deal (at least for us) of debt in credit cards. He also owes several thousand to friends. I’ve never had to deal with this sort of thing before. Because of our financial situation, we still live at home with my mother (we are both college students as well), so the only bills I myself have really taken care of are my cell phone bill, one credit card bill, and my car insurance (which is automatically drafted). We are in a paycheck to paycheck situation, but I know that we shouldn’t be.

Everyone you talk to should tell you to pay off the high-interest debts first. Don’t just pay the minimum – pay until it hurts. Get the principal wiped out as soon as possible, even if it means packing a lunch every day instead of eating out. You should be going paycheck-to-paycheck until you are debt-free*. Make sure your friends understand that their debts come second – for now – but that you have every intent of making good on your promises. Put ten, twenty, or even thirty percent of your income into paying off those debts. Live simply (consider ditching your land-line phone if you each have cell phones, or vice versa!). Once you know how much per month you can put towards knocking out debt, talk to your friends.

Say you can afford $100/month, and you have five friends, to whom you owe $1,000, $500, $200, $200, and $200. That’s 21 months to repay them all – almost two years. You could pay the first friend for the first five months; then pay the first two $50/mo. each for the next six months; then pay each of your friends $20/mo until all debts are off at once. Alternatively, you could pay them $100/mo in a “round robin” fashion, where your biggest creditors get to be first in line. At the end of ten months, three friends are completely paid off and the other two now only demand $800 and $300 respectively.

The most important thing is to get out from under that debt. As soon as possible. Any money that just “shows up” – Christmas gifts, office bonuses, etc. – should be treated as “found money” and thrown at your debt.

    • of course, you should also have two or three months’ worth of expenses in your savings in case of an emergency, but from his spending habits, I’ll assume you don’t have that laying around, and won’t anytime soon.