Thursday, January 15, 2015

I'm 31 years old and I have an allowance

We had many different allowance systems growing up.  The one I remember most is us each getting $1 every Saturday night for doing our daily chores all week.  Half always had to go to savings (the credit union people LOVED when five of us would come in with our envelopes of coins in the days before those change counter machines), 10% (10 cents) to church, and we got to keep the rest (40 cents, for those not keeping track).  I felt so rich when I had saved up $16. 

It's some 20 years later and I'm back on an allowance.  Matt is too.  They are equal.  Luke is not since he's not doing anything to earn money. (I really look forward to the day I can pay him change to do things like dust the baseboards...I hate dusting those.) 

When I quit my accounting job 2 years ago in preparation of getting a baby (who we didn't know about but ended up getting), we decided we needed budgets for clothing and hobbies since we were losing my income.  That kinda worked.  Then my sister told us about their allowance plan and that has really worked. 

We call it allowance money, I've heard people refer to it as their pocket money.  It's all the same basic thing.  Here's how we do it: we each have a set amount a month to spend on whatever we want: clothing (mostly me), candy (mostly Matt), dining out separately, etc.  We're not picky on staying within it for the month but are more concerned with the full year (as in, if you go over this month that just means you have less to spend next month).  Almost all of our personal discretionary spending comes out of our allowances.

Things that are allowance:

-clothing (besides running shoes so we aren't tempted to skimp on those)
-accessories (like my purses)
-personal entertainment (anything we do independent of each other like my books or Matt's video games)
-all candy, frozen cokes, and sno-cones (or anything similar)
-restaurant meals separate from each other (includes Matt buying lunch at work, so he'll pack more)
-my haircuts, make-up, and nail polish
-any upgrades/repairs to our personal computers
-upgrading our cell phones (upgrading my iPhone last year hurt me)
-Matt's annual karate seminar
-things for our hobbies (which means some home decor & craft items for me and computer stuff for Matt)

Things that are not allowance:
-drive-in dates and DVDs we decide jointly to buy (and even then we have a pretty strict limit for how much to spend on any, I've been watching the prices of Captain America 2 and Guardians of the Galaxy for a loooong time waiting for them to be under our $15 blu-ray limit.)
-sitters for my working, doctor appointments, or date nights
-our rare dining out together or as a family
-all necessary toiletries like deodorant, toilet paper, toothpaste, body wash, face moisturizer, etc.
-upgrading/repairing our DVR computer
-the two runs we do together


Things that are just for one of us or we do separately come out of the allowance.*
Things we do together do not.

There are also ways we can add to our allowances.  All money Matt made repairing computers was added to his.  Some of the larger things we sold at the garage sale (like my Vera Bradley bags or some of Matt's video games) were added to our allowances.  I've sold some other things on or eBay which had been added back.  Any birthday money we each receive is added on.  

This might sound a little odd.  We only get so much spending money and it's kept exactly equal.  I know.'s really really worked for us.  I don't have to feel guilty buying clothes because it's in the budget and it's coming out of my allowance.  The best part is how much more careful we now are about our spending.  This was especially obvious at the end of the year when we knew we only had a set amount to spend until January.  I did a crazy amount of online shopping and then a crazy amount of returning, trying to fine tune what I wanted to spend the rest of my money on.  It's easier to make decisions to keep something when it comes at the cost of having to return or give up something else.  We both seem to operate really well with these restrictions.

And we're not super super picky about the December 31st cutoff.  We've decided being within $20 over/under either way is fine and any extra or deficit will just be added to/taken from the next year.  It would be almost impossible to get it exactly down to the penny and then we also aren't forced to spend money on small crap just to use up our last dollars.

What started as a way to better control our spending has turned out to be really freeing and helpful.  We are more apt to watch for deals or make do with what we have when spending money comes at the expense of something else we personally want.  I wish we had implemented this system years ago; it's one of the best money decisions we've made.

*Besides medical.  My surgery costs definitely weren't allowance money. 

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