The #1 Best Budgeting Tip to Save You Money

6.04.2015

Everyone has different ideas about budgeting, and there are a ton of how-to posts out there with tips and tricks for saving and budgeting. Jordan and I have been on a budget since we got married over 4 years ago. In that time, we paid off both our cars and student loans, and we were completely debt free until we just bought our house last month (hello, mortgage until 2045).

I’ve blogged about our budget in the past, and you can check out those posts here. However, today I want to revisit one budgeting strategy that we both agree has been the best thing for our budget and our marriage. It has saved us a ton of money over the last 4 years, and if you are only going to follow one budget tip or savings plan, this is the one I recommend: set a monthly blow money budget per person. 

(EDIT: a few people have asked how we track our blow money. In our "budget binder" [click here to see it] we have a page for each of us where we write down our blow money purchases and add them as we go through the month.)

What is blow money?

The first thing to do is decide what blog money means to you. For us, blow money is simply any purchase that is a want, not a need. Here are a few examples:

-Do your socks have holes in them? (Need.) Or did you find a cute pair of boot socks to match your outfit? (Want.)

-Did you lose weight and now your pants don’t fit? (Need.) Or was Old Navy having a sale on skinny jeans and you saw a pair of lighter wash jeans that you couldn’t pass up? (Want.)

-Are you buying yarn to crochet your brother a blanket for Christmas? (Need, filed under “Gifts.”) Or are you buying pretty yarn to crochet yourself yet another scarf? (Want.)

I could go on, but you probably see my point. The blow money category encompasses hobbies, shopping, and sometimes outings and food.

The beauty in this is that he can buy whatever he wants and I can buy whatever I want, and neither of us can get mad at the other. He can think it’s dumb for me to buy new running shorts or sign up for a race, and I can think it’s dumb for him to buy another video game, but who cares? It’s ours to do with what we want. This is going to sound dramatic, but doing this has really saved us from a lot of dumb arguments.

Even if you aren’t married and no one cares what you spend your money on anyway, the monthly blow money budget is a great way to keep frivolous spending in check. No more splurge purchases at Target, because every penny of “want” is coming out of your blow money budget. Having this set up forces you to think about what you’re buying and decide if you really like it enough to spend part of your blow money on it.

How much blow money should I allow per month?

This depends on your own finances. Some people do as little as $20 a month; some do a couple hundred dollars a month. I’m sure some people do even more than that. It is entirely up to you, but the point is to pick a number that fits into your lifestyle and your budget.

The point of the blow money budget is not to stifle you into feeling like you can’t buy anything ever, but it’s also not there to let you buy whatever you want. Choose a number that’s higher than penny pinching and lower than “let’s go buy everything.” It should be hard to keep this budget some months and easy other months.

If you have never done anything like this before, my suggestion would be to go back a few months and add up how much you’re spending on “extras” per month on average. Choose a round number that’s just slightly lower than what you typically spend and try it out for a month or two. Then, reevaluate and see if you need to lower or raise your blow money number.

What do I do if I have leftover blow money?

People do this different ways, but Jordan and I roll over the extra to the next month. This is great for if you’re saving up for something big. Sometimes one race registration will be larger than one month’s blow money, so I’ll save up for two months. Even if it’s just $5, we roll over any leftover money to the next month.

What do I do if I go over my blow money amount?

Obviously the idea is to never go over your monthly amount. However, I’ll be honest and say that I do go over sometimes. Usually it’s just by $10-15, but still. Over is over. In that case, I roll over my deficit to the following month, so whatever negative I had gets subtracted from the new month’s amount. This way, you can hopefully just spend less that second month and catch back up to even. This works for us, but if you find yourself consistently going over and never able to catch up, you might need to figure something else out. Again, the point is obviously to not go over the blow money amount.

What do I do if I can’t decide if something is blow money or not?

Like I said before, in the majority of cases, blow money is anything that you would consider a want, not a need. However, there are gray lines, so sometimes you might have to think it over or discuss a purchase. Most things are obvious, but others are going to be personal opinion and preference based on your own budget. The point is to find your line and stick to it.

This is what we've found that best works for us and is a relatively simple way to track your spending, save money, and get along with your significant other. Plus, since the amount is built into the existing budget, it's completely guilt-free spending!

Here’s an example of what I spent my $100 on the last few months just to give you an idea:

March
Chacos $113.78

April
Rolled over deficit of $13.78
Sponsor a blog $10.20
Clothes at Old Navy* $63.40
Smoothie at lunch $3.79
Maxi dress $12.99
Total: $104.16

May
Rolled over deficit of $4.16
Cardigan $14.99
Sent mail to a blog friend $1.40
Project Life scrapbook pocket pages $23.97
Bethel Music CD $13.96 <-- Yes, I still buy CDs sometimes, okay?
Gift for my sister $30
= 88.48 
And woo! I'm back to rolling over leftover instead of a deficit.


*These were all maternity purchases, which technically could be counted under the general budget since they're more of a "need" than a "want." However, our budget is tight due to house stuff, so I decided to count this $63 under blow money. I have made a few other maternity purchases that have counted under the regular budget.
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Feel free to leave any questions about anything I've written here in the comments. 
Now, I'm interested to know what has worked for you and your budget.

Do you have a monthly blow money amount?
How do you keep track of your "want vs. need" spending?

46 comments:

  1. This is SUCH a good tip!! I am not the greatest at budgeting, but I like the idea of setting myself a blow budget per month. It would keep me in check for sure, even though I live on my own and no one can judge me for what I buy....a $100 Target shopping trip isn't always necessary :-P Thanks for the tip!!

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    1. This is SUPER easy to implement even if you aren't awesome at budgeting. It definitely keeps us from spending tons of money on random crap. It does get hard when I want to sign up for races (which can eat up the entire month of blow money!) but it also helps me really think about what I feel is important enough to buy and saves me from impulse purchases I don't need!

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  2. I've tried to do this before, but I'm so bad about tracking what I've spent. Do you just have a place where you write it down, or do you have a separate account for "blow money"?

    I think having at least some separate money helps a lot to prevent fighting in a relationship. Ryan and I keep it all separate. We have one joint account for our shared bills and the rest of our money is ours individually to save or spend as we see fit. Good thing too, or we'd be arguing about our hobbies all the time! At one point he was doing doge coin mining and he bought several hundred dollars of computer equipment (the good old "spend money to make money" philosophy), and I like to buy random things for my business or for household optimization.

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    1. We have a "budget binder" where we write down all of our receipts, and there's a separate page for each of us where we write down what we spent each month.

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  3. My philosophy is, don't spend money that you don't have. So if there is room in the budget for fun stuff? By all means! Buy the fun stuff! Ya know?

    My Starbucks card ain't gonna reload itself

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  4. that is a great tip. I'd also be interested in knowing how you keep track of blow money expenses. i can visually me having a chalkboard in my office to keep note of these things. You're right, though. It's so easy to spend a change here and there but at the end of the month things do add up. I may have to start doing that this month. Great tip!

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    1. In our "budget binder" we each have a separate page where we write down our blow money purchases that we made and add them as we go through the month. Here's the post where I shared about our budget binder: http://www.theladyokieblog.com/2013/01/the-amazing-2013-budget-binder.html

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  5. shoooooot did it eat my comment? Please tell me it went to spam?

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  6. We have begun to do a version of this. Initially, we weren't doing it, but I found myself feeling guilty about certain purchases coming out of our regular budget so I suggested we give ourselves a little "side" money so that we can use it without questions. I am hopeful it works well as we just started it this month! But my parents do this and HIGHLY suggested it to us when we joined finances. I think it is a wonderful idea!!

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  7. You are so organized!!!!! I guess you have to be...my husband has been trying to put us on a budget for years and I just don't make eye contact when he brings it up now....oops!

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  8. Love this...going to email it to my hubby! :)

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  9. I'm going to try to not write a book here. :) So in our normal budget, we each have $600/year for a specific hobby. L's into woodworking and I used to play in a sport league but shifted that money to clothing spending when I started grad school and had like zero free time. That's yearly because I used to pay for the sport quarterly and because L can have high spending months if he rents tools or goes to classes. Everything else we do is monthly.

    Most recently we have been paying ourselves last. Our income has been slightly irregular and we kept our monthly spending consistent on everything else by having a "leftover" allowance. Also, any elective overtime, gift money, side income or bonus that we receive stays with the recipient/earner. I know that most joint money folks don't like that approach but for us that's where we'll save for bigger purchases and hide gifts for the other person.

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    1. That's interesting doing it by year! That is a good idea to adjust based on hobbies that are paid quarterly, etc.

      Our income is always irregular because Jordan is paid hourly, not salary, so we never know exactly how much money we'll bring in every month. But mostly everything we spend is consistent.

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  10. Ooohhh...I LOVE this idea. I think maybe my fiance and I should start this, but strictly with going out to eat. We actually never really spend money on wants (clothes, things, etc.), but we go out to eat WAY too often. Maybe if we set aside a set amount of restaurant blow money, it would help us pull back. Genius! Thank you!!

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  11. Yes, blow money is so important!!! And, I still buy cds sometimes too. It's cool. :)

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  12. Ugh AMEN! I couldn't agree more. When Caleb and I give ourselves "blow" or "play" money throughout the month to get something we just want? It's so amazing! We usually do about $20/month right now since we're trying to payoff debt pretty hardcore...but I also love how you determine what a "want" is vs what a "need" is. That's how our minds work, too!

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  13. Wonderful post, friend! I agree so much that couples should still get 'individual' money to do what they want with. Jared and I have gotten a little lax on this since becoming debt free, but we just re-did our whole budget for going forward and absolutely included 'fun money' for each of us.

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  14. Love me some budgeting posts! I don't have a "blow money" budget, but I do have a shopping budget that I try to adhere to each month. Some months require more stuff (moving!) and some months, I just don't really need or want anything. I think my general tendency to hate clutter and stuff in general helps out a lot with me hardly ever buying anything I don't truly love or want. I recently bought a pair of frivolous shoes and wasn't as in love with them as I thought I'd be, so back to Nordstrom they go. I often ask "How much do I REALLY love this?" and suddenly, I'm way below budget.

    Its funny, when I had a strict budget a few years ago to pay off all car loan and student loan debt, I wanted all the things, but now that I have some wiggle room with no debt and a higher salary, I find myself becoming more frugal just thinking about how those dollars will grow in my 401k or mutual fund accounts. Guess I'm an old fart now, huh?

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  15. I love this so much because it works with or without an exact "budget." Our lifestyle at the moment is very up in the air and doesn't lend itself well to budgeting (Chris has interview season coming up, and we have no idea where they will be, so that's hard to plan for!) but blow money helps save no matter what situation you're in!

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  16. We don't have a "blow" category, but we do have categories for clothing & gifts, restaurants, and "uncategorized". So any clothing for the family goes into clothing & gifts, as well as gifts for others (duh, right?). If I have lunch with a co-worker, or a coffee from Caribou, that goes in the restaurant category. Same thing if my husband treats himself to McDonalds for lunch. In general, we try to keep that one to just dinners out with the 2 or 3 of us, though. Which helps limit spending money on lunch during the workweek, or getting coffee from Caribou (and I'm saving on those calories!)

    The "uncategorized" category gets a little hairy sometimes. I put stuff in there like pharmacy purchases or haircuts since they're not monthly for us. But sometimes I use that category for something that should be in a "blow" category - like a race entry. For the most part, it all evens out.

    Also, I'm flattered that you used some of your blow money on me!

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  17. After over 10 years of marriage, we finally got two separate checking accounts that we call our hobby accounts. The money manager (ie hubby) funds the account once a week. I'm saving my money for a bachelorette Vegas trip and races. I've also spent my money on shoes, brewing beer and soon clothes. (I need summer clothes.) I love the hobby account but I think hubby should fund it a little more. Estherdavison@gmail.com

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  18. I totally have a "fun" money category for frivolous/misc purchases. It really helps to not feel guilty for a little splurge here or there.

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  19. My husband and I do this too! I don't know any other couples who do, but I believe it has helped our marriage in so many ways.

    When we first got married, having money that each of use could do whatever we want with was my husband's idea. I was not sure how it would work out at first, because I was worried that it would feed into a "yours/mine" mentality. But within a few months of our marriage, I realized how important it is to have our own money to blow. Nick hardly ever spends his own money, and I am always at my limit. I like being able to get a new workout shirt or go out with a friend without feeling guilty.

    Before I got married, I was buying coffee every single day. I did some math during our first month of marriage and realized that if I did that, I wouldn't have any money left over for myself. So I simply got into the habit of making my own coffee, and it saves us so much money. Now I can't believe I used to spend so much money on going out for coffee! Before I got married I only had to worry about my own money, so I feel like having a dedicated budget to buying whatever I want has made me more aware about I spend money on myself and better at budgeting.

    Sometimes when money is tight and we are close to using our going out budget, we will use our blow money to "take each other out," for ice cream or something.

    This is such a great post!!!

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    1. I totally agree with you! This has really helped us. And the yours/mine mentality was a concern too, but it really hasn't been an issue. It's kind of the opposite, like you mentioned... it's so nice to be able to buy something just for me and not feel like I have to justify it or feel like Jordan will get upset. He can buy video games and I can buy race stuff, and neither of us cares! I'm the same way as you too... I usually always spend all of mine (and... maybe go over a bit), while Jordan rarely ever uses all of his. Hence, he has an envelope full of $ and I'm like "can you lend me some"? Ha!

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  20. BUDGETING. Love it. Good reminder to set a cap for Blow money. I need to do better in this category so I can keep saving as much as possible for a big trip at the end of the year --the ultimate spending!

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  21. This is a great tip! I may have to chat with Nate about implementing this!

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  22. I'll be honest, our budget is pretty relaxed right now. We still track all of our spending, but we aren't very strict with the amount we spend at the moment. We were crazy tight with our money for years while we paid off our student loans (and then saved up for cars). Now the only thing we owe money on is our house which we are slowly working on paying off (we pay a little extra each month, but it'll still be awhile until it's paid off). Since we're not actively paying off loans, we're not as tight with our spending. As long as the bills get paid, X-amount goes to giving, and X-amount goes into the savings account every month, we don't worry too much about the $15 dollars here or the $20 there that is spent more on wants than needs. We just decided this past weekend to do some major renovation to our house so we are starting to set money aside for that which means less spending on wants and less eating out (and more splitting meals when we do eat out). We don't mind a strict budget when we are working toward a goal together (like when we saved to go to Italy or to pay off student loans).

    One year we got really serious about paying everything off so we looked at all the money we had spent the previous year and every budget that wasn't an absolute necessity (like paying bills), got cut in half. We gave ourselves half as much $$ on eating out, traveling, clothes, entertainment, etc. And what's funny is that since I only had $150 for the whole year to spend on clothes... I didn't spend it. I spent maybe $50 of it by December 1st because I was so worried about finding a deal too great to pass up so I kept saving the money. I ended up spending another $50 in December alone just because I realized that I was free to spend the money and there were lots of good deals at the time. But it really taught me a lot about how much money I really need to spend on clothes to get by. Also thrift stores became my bestie. ;)

    All that is to say, though... we've never had a blow money category. Lots of our friends have and it works out well for them. I think we're always kind of one extreme or the other. Either we spend almost no money on wants while we save/pay off loans or we just don't worry that much about as long as bills are paid and X-amounts go to savings and giving.

    I feel like I always leave you the loooongest comments, haha! Sorry about that!

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  23. Just sent your post to my husband, and he is already on board! I'm pretty excited to try this- I think it'll help us save up for things we really want, and even more importantly, erase that feeling of guilt I get any time I make a purchase for myself. If the money is allotted for me... then I'd have no reason to justify it (to myself) or feel bad, and that sounds pretty awesome.

    Do you guys have a separate budget for dates? Like if you go out to dinner together? Or would that come out of each of your blow money allotments?

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    1. Awesome! Yes, the biggest plus for me is that I never feel guilty or have to justify a purchase, because it's money built into the budget, and I can use it for whatever I want! I feel like Jordan and I would have a lot more fights about him buying video games and me signing up for races if we didn't do this. It doesn't work for everyone, but it totally works for us.

      Our dates (ha! We are terrible at going on dates) come out of the "entertainment" category. Aka ordering Chinese takeout for dinner or going to a movie or eating at a restaurant for dinner.

      And we each "get" to eat out for lunch once a week. If it's more than that, we take the lunch $ out of our personal blow. So, like, yesterday I got a smoothie just because. I took that out of my blow money. But next week I might eat out for lunch during the week, and that will just come out of the regular budget. If that makes sense... the food thing is kind of confusing sometimes.

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  24. I should totally take this tip and try it. We are absolutely terrible with budgeting and the want/need stuff. We've tossed around the idea of me being a SAHM and I laugh but we reaaaallly need to cut the spending before that would ever be possible! Thanks for sharing!

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  25. We have fun money too and it has worked great. He can buy another car accessory and I can buy more nail polish and we're both happy as clams.

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  26. YES YES and more YES. I think I first heard about the blow money category in our premarital counseling but then soon after on your blog. I couldn't agree more with everything you said- it has saved us too from a lot of fights over video games (alex) and coffee/lunch dates (me). I've suggested this to some other couples and they handle money totally differently. They put a percentage of their income into a joint account and then whatever is left is their personal money that they can spend however. I personally don't think that's a really healthy way to handle married money and was kind of shocked to hear it over and over among my friends. To each his own I guess. We're at $50 each right now since we're on a single income and it goes quick when I meet with friends which sort of bums me out because then I don't really buy anything ever. Out of curiosity do you guys count coffee/lunch dates (with your individual friends) out of blow money? I feel like I need to since I go out like once a week and Alex never goes out ( he has no friends... ;) Anyway, loved this post, every married couple needs to read it and I am pinning it in hopes that they do! :)

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  27. Since we first got married we've had a "fun money" category in our budget, that was for all of our wants and dates and anniversary trips and snacks and whatever--Angel's paycheck was always varied since his was an hourly position so we just put random amounts of whatever usually the odd-numbered leftovers after everything else was put into the budget. That worked good for us in America. Over the last few months we've experimented with the individual fun money budgets...which has resulted in Angel using up his $50 every month mostly on snacks and bubble tea and me mostly saving everything for months at a time until I bought an awesome pair of sandals in March. I don't know what exactly we'll be doing in Malaysia...right now all sense of budget organization has gone out the window.

    I find it interesting how I feel differently whether the money is "for me" or "for us". When i see it as my money, I save it as much as possible, but when it's our fun money, I'm not as much of a skinflint...I'm not sure why, but probably because I know that Angel feels completely free to spend anything out of the joint 'fun money' and I should treat it the same way.

    It was the same when I was single--true, the only time I was actually single was as a teenager in college, but even then, I would go hungry and wait till I got home from school at 10 p.m. rather than waste $2 on a vending machine snack or eat at the cafeteria...I bought two sweaters at Goodwill and pretty much lived in them for the winter. Angel's the only one who really makes me feel like it's okay to waste money on stuff that's not truly needed, and I'm grateful to him for that. I would never ever stop in and pick up a slushie while filling up the tank on my car, but he will without even thinking about it, and I've appreciated many a good slushie due to the fact that I didn't marry someone exactly like myself.

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  28. This is a really great tip that I've never heard of. I really do need to try this!

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  29. We do this,and the same amount too and it has totally revolutionized our finances as well!

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  30. Good tip! I can see where this would really be beneficial to the overall bottom line.

    Kevin and I are horrible about budgeting. We are super good about automatically sending a pretty substantial amount to savings each month and we each contribute the max allowed amount to our respective Roth IRA's (him every paycheck, me in a lump sum once a year). And our only debt is our house, so we don't have to worry about car payments and such. We pay off credit cards in full each month and all bills are current. So we're responsible...but we pretty much spend what we want on fun stuff. He eats out a lot for lunch during the week and I buy clothes anytime I want to buy clothes. We could probably benefit from a more disciplined approach to budgeting.

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  31. This is really good advice, and we have something similar called "fun money", but we are so unorganized with it that we end up spending way more than we expected. Luckily we are revisiting our budget to make some changes and I'll definitely bring this up! Thanks for the tips!

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  32. this is such a fabulous post, and tip. i have tried to convince my husband to do this, but the problem is that he legit never buys anything, so he can't understand why i need blow money. the way i work is that if i restrict myself too much, i end up falling off the wagon and buying ALL the things. kind of like someone on a diet. we don't fight about money anymore - we used to squabble about it! -but he still can't understand why i might want to try a new mascara or buy a $12 top. lol.

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  33. A great tip for sure! As a "green apron wearer" at work, I often wonder whether people's daily $6-$8 beverage is considered their blow money or a "need". Most of the time I feel like I know the answer, even if it isn't one I agree with. :)

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  34. We budget in blow money too, though admittedly for any time we want to eat out or buy clothing, we just take it out of the "entertainment" or "clothing" envelopes. Neither of us are big spenders or impulse buyers, so it's not a big deal to share those. We give ourselves $15 a month for things like Matt's Diet Coke Fund (because I refuse to spend our grocery money on his insane soda habit) or if I want to go to a coffee shop and read, or buy books, or whatever. (Like, if I wanted to get coffee with friends, that would be "entertainment," but if I want to go to treat myself, that's my "fun" money.) It really is so necessary to have that money the other person can't say anything about! And if need be, we always have the option to budget more on a given month if one of us knows something is coming up or if they want to buy something bigger.

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  35. Yes, we definitely do this! And we definitely roll ours over, too. For example, my husband has been wanting to make a pretty big purchase for a hobby he enjoys, so he saved his blow money over more than a year and just bought the item last week. I don't really think he NEEDS the item, but he saved his blow money for it, so whatevs! Good for him. :) I always have a huge rollover because I basically just buy coffee and maybe some stationery from TJ Maxx once in a while, so I'll have a nice chunk of money sitting around if I find something I REALLY want in the future. :)

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  36. I love this concept! I tend to be saver but since I've got my own job now, I also am control my spending and saving. I used to think that I had to save everything I made (aside from necessary purchases, tithing, etc.) because I was still in the "school" mode but now that I'm not, I've realized that I can allow myself to have money for myself.

    This year has actually been a little bit about self-care for me so I've been figuring out how much "allowance" I'll give myself each month to treat myself--on books, on clothes, on stationery, etc.

    Thanks for sharing about what works for you! I'm always fascinated and interested to read people's tips and tricks on stuff like this. :)

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  37. This tip is on point! Also, I think it's a good gateway into budgeting in general for those who are afraid of it. If people feel confident keeping track of the $100 each month, then that should help give them confidence to keep track of their budget for everything!

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  38. What a great way to do it! Love this tip!

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  39. Goodness yes! When Cory and I first started our budget, we had one blow envelope (we use cash) and he never wanted to carry the bulky cash wallet around with him so it normally stayed in my purse. I was so bad to use all the blow and he would need something and it would be empty. It caused so many unnecessary remarks and arguments until we finally started separating it each month. Now, we don't even track it. I pull out the cash in the beginning of the month and give each of us half. Works much better!

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  40. I’m so in love with this blog post. I hadn’t seen the ones in the past, so I’m going back to start reading them ASAP. I’m OBSESSED with budgeting. Like you, we paid off our debt (except for our mortgage) and staunchly stick to our no-debt policy. I don’t know a whole lot of people that truly do this, so I love, love, love reading about how you do it. I hope you don’t mind, but I’m going to plan a series of my own that’s similar to yours. We don’t use a binder, though. I’m an Excel fanatic. By the way, I like that you call it blow money. When we had this, we called it allowance, and people would tease Todd that I kept him on too tight of a leash. They, obviously, don’t understand how cool it truly is to live without debt…and a blow money account!

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