Sarah and I use Quicken to manage an annual household budget. Everything goes in there. Monthly set-asides for the property tax bills, the home insurance, we’ve got it all covered. It should come as no surprise when we began this process that we were living beyond our means.
As we began to lockdown our personal finances and set up our savings set asides we had to stop spending money without thought for it’s impact on the rest of the budget. One of the small (by percentage) but pernicious expenses was Starbucks. Neither of us wanted to give up Starbucks, but we had to get it under control. However we didn’t want to carry around receipts all month to see how close we were to our limit.
The solution was easy. I set each of us up with free, Starbucks debit cards and loaded them with $50 each. Whenever we go to get coffee from there (and they are everywhere) we use the debit card. The Starbucks receipt always show you how much you have left on the card and at the end of the month I can refill the cards through the Starbucks website. (You can also have it done automatically on a schedule if you know you’re going to use it all each month)
As the month goes by, I can see if I’m ahead or behind in my Starbucks budget simply by looking at my receipts. Is the month half over? If so, and I have more than $25 left on my card, I’m doing great. If not I need to slow down. When I run out, it’s time to stop drinking coffee until the end of the month. It’s a simple but effective personal budgeting tool.