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Thursday, September 17, 2009

Establishing Financial Rules

If you find you are always arguing with your partner over spent money then it is time you establish some financial rules. It varies from family to family but my husband and I have found two that work really well or us.

Purchase Amount Limit Without Consultation. This is the amount of money either one of you can spend without discussing the purchase with the other person first. You could create a daily, weekly, or monthly amount. This does not include necessities like groceries. Obviously, the smaller your overall budget is for your house, the smaller this number will be. We have a really small income to work with so ours is around $20. Anytime there is something that my husband or I want to buy that isn't a necessity and that costs $20 or more we run it past each other.

24-Hour Rule. For purchases requiring a significant amount of money we always wait 24-hours before we make the purchase. During this time we each take a side, one pro and one con (even if we are both for it), and we each lay out our side. We look at all the positives and negatives so we can make a more educated decision. This rule also applies well for any impulse purchases. If there is something you find that you just have to have, wait 24 hours to see if you still "need" it. Most of the time you don't. Beware: Sales people hate this rule, especially those working off commission. I had a telemarketer tell me how stupid a rule that was. It is actually a smart rule if you are trying to stay out of debt.

These are the 2 rules that work for us. You may have more or different versions of ours. The key is to find what works best for you.

1 comment:

  1. Although I hate telemarketer calls, I also respect that these individuals have to earn an income. As I can't just hang up on someone, either, I explain the purchasing rule my husband and I use: we don't make contractual or delivery purchases without the other present. As his job and educational pursuits at this time leave him out-of-house a lot, it makes it easy not to get "caught".
    I think we typically employ the "walk away" motto as well....be it large or small purchases. Sometimes a lot of small purchases can add up to what would be considered a "large" purchase. So, we walk away for a day or week or whatever and then re-evaluate if that product/service is truly necessary/desirable.

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