C.,
I have a few suggestions:
1. Check out www.flylady.net and her FACE control journal. This is her way of helping you FACE your finances one baby-step at a time. It makes a big job a lot easier to manage and helps to control the money arguments, if you have been having them with your husband.
2. We use the envelope method, but only for the weekly expenses. It was too complicated to manage for car repairs, home repairs, etc.
We looked at the money coming in, our set expenses: mortgage, heat, water/sewer & trash, electricity, and any loans we have (look to payoff early if possible). Then with the left-over money we looked at the items we really had to divert funds to: groceries, dog food, medical expenses (prescriptions, office visits), eating out budget, and allowances for each of us. Our allowances are very small, $10 a week, and covers the cost of new clothes, make-up, coffees if we want them, new toys, craft projects, new organizing things, etc.
We found that if we did not pay ourselves a small allowance each week, then we spent way more in incidentals than we had planned and our monthly budget was shot.
Also we budgeted things like savings (for emergencies), vacations (we are looking at small vacations this year so we can pay off a current loan), gifts (we have figured out how much we want to spend on our entire extended family and nuclear family for the entire year, including Christmas), college savings for our son, etc.
I try to only pay in cash for these funds. Gas for the cars, emergency car repairs, etc are paid on the credit cards, but usually I'm only paying a $100 bill for our two cards a month. Much better than the $1,000+ bills we had had last year.
Also, remember to keep the method flexible. If I needed groceries at the last minute at the end of the week and paid for them with my credit card, I make sure to deduct that amount from the next weeks groceries to cover the cost.
3. Make a dinner menu each week and stick to it. This will save you a lot of money (less wasted food) and you can use the leftovers for lunches the next day (less eating out). You will also find yourselves healthier (fewer medical expenses) and happier.
4. Prioritize your car, home, and other repairs. Then plan your budget and stick to it. I know it can be hard; I have walked out of Lowe's with more than I went in for, but by taking only the budgeted amount of money out of the bank before going to Lowe's has helped us to stay on track.
I hope these ideas help. Good luck!