Our “no spend summer” starts this weekend

Last week, I wrote about the steps we’re taking to make sure we can get through the summer on my income alone. Throughout the year, Tony is paid to teach undergraduate classes at his university. Now that it’s summer, he won’t be receiving a paycheck. We knew this was coming all year, so we saved enough to cover his income through the summer without using our emergency fund. But now we want to try to hang on to that money, too.

We’ve come up with a new plan to ensure that we don’t overspend and we’re able to save. It’s something we’ve never tried before, but we’re excited about the challenge. Beginning this weekend and continuing through the months of June, July, and August, we’ll not only be limiting our spending, but we’ll be living on a cash budget.

Here’s how it works:

I added up our total income for the summer without Tony’s paychecks. Then I divided that number by three months to determine our total monthly income. I added up all of our fixed expenses — rent, utilities, and other bills — and subtracted that total from our monthly income. After paying all of our fixed expenses, we’ll have $370 left each month. That means we can only spend $90 a week on groceries, entertainment, and other expenses. This is only a little less than what we would spend anyway, but lately we’ve been more and more complacent. I really want to make sure we’re not tempted to go over.

Each week before we head to the grocery store, we’ll withdrawal $90 in cash from our bank account. This will be our only spending money for the entire week. We’ll have to work extra hard to stay within our grocery budget, and if we go over, it’ll reduce the amount we have for entertainment and other expenses. I’m anticipating that we’ll spend $60 or less each week on groceries, $20 on household expenses, and $10 on entertainment.

Our idea for a cash budget for the summer was inspired by Small Notebook’s “no spend month.” It’s essentially the same concept, only we’re not limiting our spending quite as much as her family does so we can maintain it over three months instead of just one.

As an incentive to hang on to as much cash as we can, we’ve decided that whatever cash is left at the end of the summer will go to something fun. We’ll see how much is left before we go making any plans with it. :)

I initially decided to pause saving for the summer, but based on this budget, we’ll be able to save $250 a month (about half of what we normally save). At the end of the summer, we’ll be able to put the $2,000 we saved to supplement our summer income into our regular savings.

I’m a little nervous because I’ve struggled with cash spending in the past. But we’re really excited to take on this new challenge! I think it’ll be a good exercise to get us back on track. For the past few months, we’ve been a little too comfortable. Each month, we go a little more over budget on things like food and shopping. Hopefully this summer will get us back on track.

Our no spend summer begins this weekend. Any tips on how to make a cash budget work?

21 thoughts on “Our “no spend summer” starts this weekend

  1. EastTXmom

    Karen –

    You can do this!!! Once you get in the mind set that this is all the money you’re allowed to spend you’ll start viewing your ‘cash only’ stash differently. It’s very hard not to think about the $$$ you have sitting in the bank. My parents grew up in the 30’s and 40’s (and no, I’m not that old, at least 39 doesn’t feel old yet!) and came from families who didn’t have a lot of money and they passed onto my sister and I that if you didn’t have cash to pay for something then you didn’t need to buy it. I look back now and remember how upset I’d get with my mother at the check out stand because she refused to spend 25 cents for a pack of gum or how embarrassed I’d be when friends would visit and the only thing to eat would be leftovers or balogna sandwiches and my mom’s reason for not buying extra was “we don’t have the money.” What a smart lady my mom was to stick by her guns and not give into a whiney child. Because of that engrained sense of paying with cash, she and my dad were able to retire and not worry about if they’d be able to get by. And this was without investing a penny. Okay, sorry, I’ll stop with the preaching, even though it is engrained in me since I am a minister’s kid.

    With the economy the way it is I think people are now realizing how empowering cash can be versus buying on credit. Or just being debt free is a huge burden off the shoulders.

    You seem to know where you want to go, how to get there and by what means you’ll do it. That alone shows how dedicated you and your husband are to obtaining your goals.

    Keep up the hard work and dedication to your dreams!!!

  2. Bobbi

    When I take out so much money for the month (cahs) I seem to handle it better and make better choices than just using my debit card. I think it will really help keep you accountable. I am getting back to that in June also. I only have one income so maybe I can play along too. :)

  3. Karen

    @EastTXMom Thanks for the encouragement! I think you’re absolutely right that the best way to stay on track is to spend ONLY the money you have. We’ve been getting ahead of ourselves lately, so hopefully this will get us back on track.

    @Kacie I actually thought about how we’ll track, too. Luckily, most of our cash will go to groceries, some to household expenses and the rest to entertainment, so there won’t be much to track. Mint allows you to split ATM transactions, so I’ll probably just hang on to receipts until the ATM transaction shows up on Mint, then split the cash. I’ll let you know how it goes.

    @Sharon & Bobbi Good luck! Let me know how it goes for you!

  4. Margot

    Your plan sounds like a great experiment and learning exercise. I’m confused, though…why doesn’t Tony work during the summer? My friends who have done PhD degrees have earned money over the summer (even if it was part-time while they also did dissertation work) through the following: working on books/research with a professor, tutoring, consulting in their industry, bartending, teaching for Kaplan or other test prep services, and many other easy, hourly jobs. If you did your current plan and he brought in income, all of that extra money could fund part of your trip to Europe.

  5. Karen

    @Margot – Tony has been hunting for a job for the past two months. There’s more information on our original plan if you click through the link in the first paragraph. Unfortunately, we had to come up with a back-up plan, because there’s nothing available on campus (massive budget cuts even threatened his teaching assistantship earlier this year, so we’re just thankful he’s been able to hang on to that). As for part-time work, the economy is so bad in the area where we live, that he’s not had any luck finding anything part-time in retail, restaurant work, etc. When he calls to follow up, they tell him, “We’ll call you.” They don’t. :( He hasn’t given up looking, but for now we’re finding a way to survive and save without that extra income. If he finds something, you’re right, it’ll all go to savings. If not, we’ll at least be able to get by and continue saving.

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  7. Amy

    We will be tackling this in the month of June. I am anxious to see if we can do it. My dh owns his own business and the work is getting tight, so we are taking a much needed and budgeted for vacation, with a limited amount of $ in our pockets for spending money. I have two boys, so I am excited and scared at the same time. Good luck to you…you can do it! :)

  8. Sabrina

    I keep wanting to go cash only, but it keeps not happening. I’d really like to just take out cash and put my debit/credit cards and checkbook away. I think it would keep me more accountable about money, because I’d see exactly what I had to spend.

    Sabrina’s last blog post..A splurge!

  9. Mrs. Money

    I am curious to see how this works for you. I’ve been kicking around cash only too, and I think I’m going to try it for a month like you. I think it will be easier for me to physically see how much I have left versus me swiping my debit card and spending money because I know it’s in the bank account. Good luck!!

    Mrs. Money’s last blog post..Should we Refinance?

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