There are these topics that I always talk about and I feel like saving money definitely is one of them. Whether it’s discussing spending tips with friends, thinking about how I’m going to save money throughout the year or basically keeping on top of my budget, I think about money a lot.
I’m not totally obsessed about it, but I do know how important managing your money is. My parents were very honest about money to my sister and I early on and I really thank them for that. I do think it’s a topic that needs to be discussed as early as possible so that it becomes a habit and not something you have to really force yourself to do.
And to be honest, I like managing my finances. I enjoy knowing how much gets in, how much gets out and how much I can put aside each month. Being someone who likes to control her environment, I feel calmer and more on top of things when I know where I stand budget-wise.
So here’s what I do:
Create a budget document
Ever since I created my Budgeting Excel document, it all feels a lot more clear. Having all the numbers on how page, being able to do quick calculations and to easily update everything makes it all the more easy to stay on top of my budget without having to spend too much time on it.
Here is a blank example of my budgeting sheet:
I write down how much is on my account at the moment, I calculate my monthly fixed expenses and then what’s left. As you can see, monthly I calculate how much I want to put aside and how much I want to invest/spend as a treat. It depends on whether I have birthdays that month to take into account, trips etc. That way, it’s all specific to a month. Then if I have “projects”, I will make sure to put them in. For example, I know I need to save for our NYC trip in the fall so I make sure to put money aside for that.
Also, I create a “monthly project” category. For example, for this month and the next it’s all about decorating. I want to invest in frames and mirrors so I made sure to do some research about the costs and to include them in my budget.
Share budgeting techniques
I do understand that for some people, finances can be a bit daunting. It’s a serious topic and impacts your life a lot.
But I find that all you need to do is find a budgeting technique that works well for you. Maybe the way your parents do it don’t work well for you, so maybe talk about it with your friends. Do they use an app? Do they check their finances every week? Two weeks? Month? Do they write everything on a notepad, online, do they use a website?
It’s all about trial and error in order to find what you find to suit your life and lifestyle.
Do Regular Check-ups
I think that in order for your budgeting to go well, you need to work on it regularly. And it doesn’t have to mean spending an entire day on it every week but I would say every start of a new month is good. Just sit down, get out your budgeting system (for me it’s my Excel file) and make sure everything is up to date to start with. Did you write down every expenses you’ve had? Do you know how much you have on your account? In your savings?
Now, did you respect your budget? Were you able to put some money aside or less than planned? Or more? Did you overspend on something (ex: food)? Can you explain it (I had a few nights out with friends)? Is it something you didn’t consider before or just something occasional (ex: you usually go out with your friend once a week vs you went out with each other more because one of you was going through a rough patch and friends are a good form of therapy?)
The key is to be able to readjust when needed. It would be pointless to plan something and never make sure that it’s working well for you. Maybe you need to readjust how much you can save or spend per month or maybe you know you are likely to have more expenses in the upcoming weeks and so you should readjust your budget. There is no perfect way to do it, it’s all about making sure it matches your life.
- be realistic
- when in doubt, choose the highest number (grocery shopping is usually between 30-40 per week? calculate using 40. It’s better to use the highest side of the scale to be better prepared
- do regular check-ins
- allow yourself time to adjust at the beginning
- don’t give up if you see it’s not working well. Just sit down alone, or with a friend or family member you trust and work on a budgeting plan that could work better for you / is more suited to you and your life
- just accept the fact that not every month will be perfect. Maybe you will need to get your car fixed even though you hadn’t planned it, maybe you’ll need to get a new coat because yours isn’t warm enough for the dropping temperature. It’s okay, just know it’s temporary and make sure not to make a habit of it.