Im ashamed at the way we've been handling our money. This past year was great in terms of us living it up. Mrs. Dollar stayed at home with our 15 month old. We purchased a house and I got a promotion at work. However we have been very very lazy with the finances and even worse we got too comfortable with our lifestyle. First off the budget, we stopped using the envelope system which worked wonders with our debt before we had our daughter. We are now on a manual allocation each month finding ourselves overusing the debit card and even worse starting to RELY on our credit card. We'll fix that problem in a minute...

But lets go to an issue i want to unload.We bought too much house. There... i said it! We are two 27 year olds with a 15 month old and we live in a $365,000 house. Sadly it took us about 8 months to realize this and at the time we were wrapped up in the emotions of having the best because we DESERVED it.Today our mortgage payment is $2400 which includes escrow. We make ends meet every month and have just enough to enjoy some luxuries or extra toys for our daughter. More importantly we have lost the core values and basics of personal finance and we are paying the price.

Mrs. Dollar not working has taken a hit to our income and savings obviously, however she plans on returning to work in August. Ok first things first, get off exempt at work. Ive been claiming exempt to get through a financial rough patch. That has been adjusted to 3. Second, we are going back to what we know best, envelope system and sticking to the budget. No frivilous spending and we are lowering eating out at a restaurant to once a week. Secondly, lifestyle. We either need to sell the stuff we have or take care of it. I am a huge proponent of being appreciative of what we have accumulated, not getting more. We also have to make time to organize and inventory. Im sad to say that we have high consumption tastes with a low income to support this habit. We are officially living paycheck to paycheck. Its time to start cleaning up the mess and get our mindset back in the right financial gear.

More to come after we get our act together.