The joys of being at the lower half of the middle class! The days of 2 incomes making an impact are gone, and now, for most of us, 2 incomes are how we survive.
So, how best to make it work? The first step is setting up a budget. There are lots of free or inexpensive choices for helping us manage our money. I used to keep a basic spreadsheet and just plan a month ahead, tracking our expenses and measuring it against our checkbook. But it took a lot of time, so I switched to BudgetSimple (lots of people prefer fancier programs like Mint.com because they do all sorts of analyses and graphs and charts, but since I have been doing this for quite a long time, I don't have any need for the bells and whistles - and I really didn't want to pay for it).
This program is the simplest one I could find that did what I needed, which is basically just to track expenses and let me know when I've hit my limit. It's a basic "envelope" style program, where you assign a particular amount of money to each category you create. You can change it or transfer money between categories if need be, and you can alter a monthly budget for one-time expenses.
My job right now is to tighten our budget's belt a bit in order to get a few things paid off. So, I've been brainstorming ways to do that. We don't really overspend much in any other category but groceries and that amoeba-like category labeled "miscellaneous". I like my budget simple, but I'm going to have to break that category down to really see what we're spending that money on.
It's sort of like keeping a food or fitness log. We find out all kinds of stuff about our habits when we physically track them and can look at them over a period of time.
One thing we've seen become a growing monster of a habit on our budget is coffee. Good lord that sweet, sweet addiction can add up to a caffeinated crap-load of $3 purchases.
More than anything, a budget is a way to sort of make a contract with ourselves and anyone else who shares that money. We make a plan and try to stick with it, amending it where necessary and possible. Checking it weekly (or more) can remind us that we need to slow down, or that we need to come up with a new game-plan. This sort of thing is especially helpful if that pool of money is being sucked down by two or more people. Sometimes, one person is in charge of the budget...but it's necessary for both/all to be in agreement and to try and follow its guidelines.
