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I keep my checkbook balanced to the penny and I record transactions in my check register as soon as I can: debit cards, checks, and any statement of automatic direct debits. (For automatic direct debit bills, I record both the date I received the bill and the date it will be debited.)

Since I don't budget, I have an added incentive to keep the check register up to date: it serves as my proxy for a budget. If I am anticipating a non-trivial purchase, I'll get my check register, thumb between the current balance and the expenses that occurred last month between that date and payday to see if it looks like my checking account can handle this purchase plus anticipated bills. (In April and October I have to also thumb back 6 months to make sure I can also cover car insurance.) If I have credit card charges not paid off, I'll do my projections as if the credit card charges would be paid off before next payday. There have been a number of times I have delayed purchases for a month or two based on insufficient amounts in my checking account.

Savings and investments will have already been subtracted out of my checking account balance, either by payroll deduction (401(k), money market account) or by automatic direct debit that I record the same day I record my payroll direct deposit (taxable investments). I learned in 1980 that I cannot save the money that is left in my checking account, at least not on a consistent basis, so my answer was to put savings on "autopilot" so it doesn't stay there, begging for me to spend, spend, spend. Instead, it is saved, saved, saved before I have a chance to thwart my savings goals.

By limiting my discretionary purchases to what remains available in my checking account and won't be needed before next payday, I have effectively paced out my discretionary spending.

I'll raid my money market account for cash emergencies and property taxes, but by never having stopped the payroll deduction to feed it, it is kept well funded for the occasions where it is needed. I had opened that money market account about 20 years ago with the thought that I would avoid touching it for ordinary living expenses, and on the mostpart I have been successful at it. I'll also use the same account for saving up for an anticipated major purchase but, if it is a non-essential, I consider the savings for that purchase to be after the earmarked emergency fund + property tax + next year's Roth IRA contribution.

But for month-in, month-out discretionary spending, my allowance is what remains in my checking account after allowing for anticipated bills.

--Mark (The ZERO) Young
Living out of my check register since June 1976
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