the “new frugality”

It doesn’t bare repeating that times are getting “tough” (if they weren’t already), and that consumerism is at an all-time low. Yet, things get really interesting when these rough times hit just as you’re trying to settle through a financial merge… and it’s the first time you’ve had to make savings/spending decisions with someone else.

I’ve always been a penny pincher, but it has gotten very difficult to adjust my ultra-savings ways into a 2-person household. I have irrational savings habits that I’ve tried to impart onto poor Mr. M, and I’ve realized they’re more annoying than helpful. It was only through reflecting on our “home savings” process that I realized that budgeting wasn’t our answer

You see, when we were saving for that giant chunk of a down payment/closing/move-in costs pile, we did it by socking away big chunks of money with every paycheck. So, that is what led us to live our financial life by the “save it before you see it or spend it” plan. [First, to clarify, we have completely unified assets, meaning we share all of our income with each other] We’ve divided up our money into tons of accounts… all with their strict savings and spending purposes. Then, instead of hoping there’s money left at the end of the month to save, we can spend the money that’s left without too much worry.

Here’s how it breaks down:

‘Da house bills fund: $ deposited to pay mortgage, insurance, taxes, utilities (gas/electric, sewer/water/trash, satellite, phone/DSL & cell phones)

Retirement: 401k/403b matches before paycheck, and the rest goes into IRA fund savings

Fun money 1 & 2: We each have our own “fun money” spending accounts and only have access to our own records (no way to cheat and look at others)

E-fund: break in case of emergency

Medical bills: $ pulled out every paycheck for prescriptions/Dr’s apts… the year-end balance is spent on over-the-counter medicine, eye glasses/contacts

General stockpile of money: where the rest of it lives! $ for food, travel, gas, furniture, Target purchases, home improvement, etc.

Future savings accounts TBD: we’ll open as many as we need for monthly direct deposits to meet whatever needs we have

Our little formula is far from science, but it’s helped me ease away from my frantic money worries little by little. It’ll need to be refined now and then, but our basic categories have held up so far. Now when I see our “general stockpile of money” account balance, it’s nice to know that it’s really what we have available to spend… and budgeting that money is much easier than worrying about the whole chunk of it!

….and when I want to feel rich, all I need to do is check out our account balances at mint.com and see everything laid out in one place!


  • Mdaggs

    When we got married and combined our accounts, it was amazing to see so much money in one place. I have also become a crazy saver though. I put as much money into our savings account as I can when we get paid (Chris twice a month, me monthly). We try our best to live off of that general stockpile account without transfering $$ out of our savings but it always seems like things come up. But I am happy to say that in just 5 months, we now are building a decent savings account up for that “BIG” purchase looming 13 months in the future!

  • Laura

    I like how you’ve created all of the different accounts – are the savings funds across different banks? I have 3 different bank accounts but hate how long it takes for funds to transfer between them. I’m thinking of making my ING Direct account my main one since you can easily create sub-accounts within an account.

    Looks like you guys have a good plan! I just got married and am the breadwinner since the hubs is in medical school, and I’m the penny pincher of the two of us. It’s been hard trying to balance between our desire to travel and enjoy life, and my reminding DH that we have his mounting loans to start paying off. =)

  • erin

    How are you liking Mint?I’m going to be taking over finances in the household, and I’m consdering signing up for it vs. using Quicken (which my husband uses.) I like that I can access it from work or my home computer…so I’m curious your thoughts! I LOVE the idea of multiple savings accounts!!