Monthly Money Plan

As part of my ongoing efforts to Simplify. Everything. – I have reworked our monthly money plan.

Our monthly money plan details our strategies for managing our household finances.  The money plan is very similar to a budget – but it also incorporates the use of a calendar and a filing system.

I like for things to be organized.  Our monthly money plan keeps us on track, moving towards our main goal, and in control of our finances.

Our Income Sources –

My wife and I both deposit our monthly paychecks on the first day of each month.  This is our regular income.

I also receive money for various part-time work.  This is our irregular income.

Our Budget –

We use a very basic zero-based budget to manage our regular income.

Irregular income is used to create a secondary budget – for things like vacation planning, reducing our mortgage principal, and longer-term savings goals.

Our Big Goal –

Currently, we are working to pay off our home mortgage in less than ten years.

Our Monthly Money Plan –

Step 1 – Paychecks are deposited at our local bank on the first day of each month.

Step 2 – Cash for monthly expenses is placed into our envelope system.

Groceries for us and gasoline for our automobiles are purchased each Monday – using the cash from the envelope system.

Step 3 – Bills are paid.  It’s very simple to locate and pay these bills.  They are either bookmarked in my web browser for easy access – or in our bills to pay file folder.  We pay our bills online via our primary checking account.

Step 4 – Paperwork associated with bills is filed.

Step 5 – Deposits, withdrawn from our primary checking, to our online savings account, are scheduled.

Step 6 – Deposits, withdrawn from our primary checking,  to our Roth IRAs, are scheduled.

Step 7 – Extra, principal-only payment is made to our mortgage provider.  Click to see our debt reduction progress!

Step 8 – Irregular income is deposited, as received, into our online savings account.

Step 9 – Budget needs for the upcoming month are discussed and budget is updated.

Step 10 – Mid-month and again at the end of the month, I check to see that all payments have been received and deposits have been credited.

Step 11 – Charitable donations are made.

Step 12 – We balance our check book.  This takes about two minutes – because our bills have all been paid and we use cash and debit for 95% of our off-line purchases.

Once a Quarter –

I check on our retirement accounts and make any adjustments that I feel are necessary.

Once a Year –

I review all insurance policies, to insure correct coverage and good rates.

That’s it. That’s our monthly money plan.  We make deposits, use cash, pay our bills, work hard to earn a little extra now and then, build our savings, and reduce our debt.  It’s very simple and very basic – and it works for us.