Let’s talk about a major budgeting issue, through an extremely likely scenario for which I’ve been in myself.
You woke up late for work, you start rushing to get ready, and you run out the door with just enough time to catch your regular morning train.
There’s only one issue; you just forgot your breakfast, lunch, and snacks at home.
Obviously you can’t go the whole day without eating.
Don’t lie to yourself just because hunger hasn’t exactly kicked in yet.
You and I both know that hunger is going to come creeping up on you sooner rather than later and that’s the end of any productivity you had.
I bet you’re saying to yourself “k… but I can just buy something to eat. This article sucks”.
Sure you can — or can you?
Remember last night when you went out with your friends and one drink turned into four, and of course you can’t forget the late night double-cheeseburger pickup at the end of the night.
Well your bank account is now sitting at $1.34, and you can’t even buy another one of those double-cheeseburgers to attempt to hold you off.
Let’s be real, if you’re reading this (not you drizzy) chances are you might have been there before.
You messed up and you’re hating yourself for it.
Many times saying to yourself how you should have stuck to one drink, and just have eaten at home last night.
Maybe even saying to yourself you shouldn’t have even gone out to begin with.
However, that’s not where you messed up.
You messed up because you failed on your budget – or worse, you didn’t budget at all!
I’ve been there so many times.
More often than not, until my early 20s, were there moments of unnecessary starvation.
If I had known just how much a budget would have helped me beat those moments, I would have been the budget king (budget king sounds like burger king – or is that just me?).
My biggest problem? I failed my budget way too often.
I was going out with friends using money that was allocated to buying food during the week.
What was even worse, the day I got paid was the one day of the two weeks I had the most fun – spending it all in one day.
How did I fix this issue?
With budgeting and our first – and most critical – step to perfecting any budget:
Just like anything else in life, if you want to succeed at something, you need to be committed to that one thing. There’s nothing as important as discipline when it comes to staying committed. You want to commit to a healthier fit body? You have to commit to going to working and eating right. You want to learn a new language? You have to commit to practicing several times through out the week. Well the same applies to your budget. You want to advanced financially, stop running out of money when you want and need it most, and amount to a high net worth – it’s starts with committing and being disciplined to your budget. You don’t need that high calorie double-cheeseburger. You have an awesome bowl of Reese’s Puff cereal waiting for you at home. Less [spending] is actually more [money] here.
2. Know Everything About Your Financial Health
Saying you’ll be disciplined is one thing, but putting it to action is another. Let’s put a solid budget in your hands to start – this is where your discipline starts too. You’re going to have to be honest with yourself. Don’t try to sugarcoat your own situation because you’re only lying to yourself. Here’s what you’ll need to know exactly who you are – financially:
- Pull a credit report and check everything you owe
- Record all your sources of income for the month (if it fluctuates record your lowest month)
- Track your expenses for the previous month to see where your money goes
- Set out your personal financial goals you want to achieve
Once you know what you owe, what comes in your account, and what goes out, we can begin to lay down the foundation of your budget to set out and reach those financial goals you have in mind.
3. Start Prioritizing Your Expenses
So what comes first, rent payment or the club? It’s obvious but it’s a good start. Begin by listing the top most important expenses you have to cover within the month. Maybe it’s rent, or maybe it’s transportation to work if you live with your parents. Once you set out your most important expenses to take care of, you’ll being to have remaining ‘wants’ that you can set after that. Some important things to remember when listing are:
- Groceries (You have to eat)
- Transportation (if work dependant)
- Child Support
Traditional budgets would just end here. It’s because that’s how simple this all is. It’s really just down to the discipline you have against the temptations of breaking the plan. But in today’s day and age, doing the above and keeping to the plan can be so much easier thanks to technology. Which takes me to our number four point…
4. Stay On Top of Your Finances
There are so many different ways to track your income and expenses as you start to put your budget into play. Not so long ago, you’d have to keep receipts, and sit down at the end of day/week and write it all out. Back then, budgeting and book-keeping spreadsheets were chosen as the popular choice to track your spending. In todays world, we have the ability to use our phones, and better yet, we don’t have to do much to track that expense. Many apps nowadays will automatically track your expenses by syncing with your bank account – securely.
- mint.com (mobile app)
This is my favourite app. You can use it on a desktop by going to mint.com, but I primarily use it on my mobile phone. The app securely connects to your bank account and adds the transactions and funds into calculation. You can check your complete financial health right from this app if you connect it all.
- Every Dollar (mobile app)
I got this app recommendation from the budget king himself, Dave Ramsey. I was tuned into via podcasts, and he always mentions the app. So I thought I’d give it a shot. Turns out I really liked it. It’s more of a manual tracking approach where you’ll spend and have to add it yourself, but it’s user friendly interface and you can set budgets on anything you can think of.
Although there are plenty of more apps, feel free to browse around and see which suits you best. These are just two examples to get you started.
5. Leave Some Room For Fun
When it comes to working out, you got to eat healthy to see though ‘Gains BRO’. But occasionally you’ll have a cheat meal to balance out those tough cravings. Without those cheat meals, chances are your clean-eating days will come to end quicker than you thought. The same thing happens when you’re budgeting. You’re saving money and paying down debt, and you’re getting financially fit, but if you don’t splurge just a bit here you’ll find yourself breaking that budget. In addition to all that, you make money to spend money – let’s be real. This doesn’t mean you’ll spend all of it, because it takes money to make money. Treat yourself to some time our with your significant other, friends, or shop online for your next favourite game.
As you can tell now, creating a budget is easy. And perfecting your budgeting skills can be just as easy.
However, discipline is the true issue most of us face when it comes to our budgets.
Even the best of the best fall back every so often.
But don’t give up and don’t restart.
Keep the budget going and just pick up where you left off.
Use the mobile apps we’ve recommended to track expenses on the go – or any other you feel comfortable with.
And always remember, have some fun here and there to keep your mind entertained.