Are Allowances Just for Kids?

In her blog this week, Jennifer talks about spending and how it might be helpful if she had an allowance to know exactly how much she could spend.  Coach Emily seconded that idea and they drew up a plan to give Jennifer the structure she craved.

“When Emily and I met to create my budget, I suggested that it would be helpful for me to have a daily allowance.  We created a bill checking account and a daily allowance account.  We figured exactly what I pay each month in bills – give or take a little – and that amount from my paycheck is deposited directly into my bill account. The remainder of my income after paying my bills and putting money into my savings and Roth IRA will go into my daily allowance account.”

Coach Emily and Jennifer figured out a daily allowance spending limit taking all the other financial considerations she has, paying down debt, increase savings and other financial goals into consideration.   

Then, Coach Emily set up automatic transfers to make everything organized.  Certain amounts of money were automatically moving to accounts when they needed to be, leaving Jennifer feeling like this new plan is realistic and something she can commit to.