The number one cause for divorce in America is fighting over finances.  I can understand why.  When two people come together in marriage, they bring with them different views of handling money.  The result of such a combination is frustration that leads to isolation.

When this happens, couples retreat to different sides of the home, choosing to claim “their” money and choosing to spend it whichever way they want.  Before long, the couple becomes two individuals sharing a home, with no shared conviction over how they will give, save and spend.

Yesterday I read this article in USA Today.  The basic claim the article made was that a new study shows if you want to be able to pay for “the basics,” save, and cover a “few extras,” then you need to make $150,000 per year.

I couldn’t disagree more.

I’m sorry to disappoint, but I don’t nearly make $150K.  Steph stays home with our kids, and I am in full-time ministry.  But we do pay all our bills, save quite a bit, and give away a large amount each year.

It is not more money that people need.  What they need is a plan.

In 2010, I wrote this post detailing all that Steph and I pay for with cash.  Since then, we’ve met with many couples who want to know exactly how we go about doing it.  The following is what makes it all possible.

About 5 years ago, I was determined to come up with a better plan for how we gave, saved and spent money.  I wanted something that would tell us what to do with our money once we had it, so we wouldn’t have to decide once our bills were due.

I sat down at our computer, and created a simple spreadsheet for us to use.  Little did I know, we would use it religiously twice a month for years to come.

You can download it here.

You might not be a “numbers” person.  I wouldn’t say I am either.  What I do value is a strong marriage.  Once we experienced the tension in marriage as a result of financial issues, I knew we had to do something different.  Maybe you are in the same boat we were.

We loved this system so much, we started telling others about it.  I found myself answering the same questions about how to use it, so I finally created a “sample” version, complete with comment boxes explaining some of the specifics.

When we do pre-marital counseling with couples, this is one of the resources I get most excited to give them.  I know if they use it regularly, it will significantly decrease the amount of miscommunication or unreal expectations they have when it comes to their money.

Here’s how I would recommend using it:

1. Review the spreadsheet.  There is a sample tab on the bottom left-hand corner of the screen, followed by tabs for each month of the year.  Each month is broken down into first and second half of the month, and again, there are comment boxes to explain some of the rationale behind it.  On the sample page, I built it off a straight-out-of-college salary.  Chances are, you will be encouraged to plug in your own salary.

2. Discuss this while on a date with your spouse.  This doesn’t seem like the most exciting date subject matter, but you’ll probably be surprised.  If you approach this as wanting to talk to your spouse about eliminating a big area of tension in your marriage, your spouse will probably be all for this conversation.

3. Fill out the spreadsheet.  Begin by understanding the combined salary of you and your spouse.  Once that number is known, work down from there.  If your salary fluctuates each month, create this budget using the most conservative guesstimate of your monthly income.

4. Start following your own orders.  If you took the time to discuss this, and then you created a plan, now is the time to follow the plan you made.  Make sure you note every penny you spend each month.  This will be important for the next step.

5. Correct your mistakes.  At the end of the month, you will realize how badly you projected on some of the areas in your budget.  This is ok.  It will take you about 3 months to get your system nailed down.  Expect mistakes.

6. Repeat steps 1-5.  You will need to spend some focused attention doing this for a few months.  After that, the plan really begins to diminish the tension in your marriage over finances.

I hope that helps.  It sure has helped us.

Is there anything you use that has helped you and your spouse handle money?