But in New York, where a new study from the Center for an Urban Future, a
nonprofit research group in Manhattan, estimates it takes $123,322 to enjoy the
same middle-class life as someone earning $50,000 in Houston, extricating
oneself from steep bills can be difficult.
My parents are going to love that tidbit from the NYTimes article "You Try to Live on 500K in This Town." I'd love to say that CT is not 3x as expensive as Houston, but I bet it's 2x, which makes you wonder why Yankess paying these prices make fun of Southerners for being dumb.
And so, like almost all other Americans, both North and South, we are trying to economize. We've tried before, with little success, but now we had kids, only one income, higher expenses, a failing economy, and thus more impetus than ever before.
Our new system is based on envelopes. A plain old stack of small, manila envelopes with clasps. Each envelope is labeled with the categories we chose, including groceries/housewares, entertainment (dinners out, museum admissions), social (i.e. having parties and giving gifts), and one each for me and Mama. Each envelope gets a specific amount of cash each month. And that's it. We don't put certain things in envelopes, like gas, medical co-pays, or any of our regular monthly expenses--why keep money out of the bank for things that we already pay with credit cards or for surprise expenses? For that, we have our checking account. And a "bank" envelope for money leftover each month. It's not exactly Dave Ramsay's system, and he seems to be the envelope guru these days (though, I'm guessing the system has been around in its own way since we became a cash not a barter society), but it is definitely working for us.
Yep, it's working. I hate forking over "real" money for coffee and now that I've run out of all the money on my Starbucks cards, I'm drinking a lot less. Mainly, because I save my envelope money for stamp class, books, souvenirs from the city, etc. It's also keeping me in line at the grocery store, knowing I've got to stretch that envelope to the end of the month. I was more creative in the kitchen during the last week of January, as you can imagine. We intentionally chose reasonable amounts of money for each envelope--within our budgets but not (yet) unnecessarily restrictive. And it's definitely a learning experience--I look back on January and wonder how exactly those envelopes became so slim. But we keep all the receipts in each envelope to help us remember (and make notes on the envelopes).
It's not rocket science and it's long overdue for us. No doubt we're learning lessons we should have long ago. But when two women have incomes and no real expenses, as we did before 4 years ago, there wasn't much motivation. It wasn't a system that was going to get us through family life successfully, though, which took us a long while to realize (and then our more recent, non-envelope attempts to budget failed). So, like most Americans who have lived high on the proverbial hog til now, we're paying that proverbial piper (ooh, gotta love mixed proverbs). And it actually feels really good.
