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Staying Motivated While on a Budget

Regardless of whether you have just started budgeting, or have been budgeting for a while, staying motivated to make and stick with a budget month in and month out can be tricky.  Let’s be honest, putting self-imposed limits on our own spending isn’t always as glamorous as the vacations we see people taking and posting on social media. Not to mention we live in a society that is filled with temptations and surrounded by impulse purchase items that are strategically placed to part us with our hard earned money. achieving success

We always start budgeting with the best of intentions – securing our financial future. But keeping the big picture in mind can be difficult. Let’s look at some strategies that you can use to stay motivated to stick with that budget.

Track your Progress:

Paying off debt? Saving for a vacation? Paying off your mortgage early? There are plenty of printable charts and graphs that are available online that you can use as a visual reminder of just how far you’ve come, which in turn will motivate you to go even further.

Take it a step further and put that chart or graph somewhere where you will see it everyday. Watching the debt that you owe go down or your savings go up is a great reminder as to why you started budgeting in the first place and will motivate you to stick with it.

 

Treat Yourself Every Once in Awhile:

Now I’m not talking about going out and blowing the bank, you do want to keep it modest, but set an increment where once you’ve reached it you’ll give yourself permission to go out and treat yourself to something nice. So maybe after every $1000 of debt that gets paid off, you can pick up your favorite specialty coffee or treat yourself to a nicer cut of meat on your next grocery trip. The key here is that no matter what modest treat you choose, you are rewarding yourself for a job well done.

Read Some Financial Blogs, Watch Financial Vlogs, or Listen to Some Financial Podcasts:

Even though my husband and I have finished paying off all of our consumer debts and student loans, we still listen to Dave Ramsey podcasts to help keep us on track. There’s nothing I’ve found more motivating than listening to hard working people scream at the top of their lungs, “WE”RE DEBT FREE!!” While cooking dinner, I’ll also hop onto YouTube and see what my favorite financial YouTubers are up to and what financial progress they are making.

When trying to stay motivated, I’ve found that it always helps to surround yourself with like minded people who are also working diligently at either paying off debt or saving for their future. If you can’t find people in your everyday life who are motivated and sticking with a budget, we are lucky in this day and age to have such a great virtual community of financially like minded people that can motivate us.

Create a Vision Board:

Remind yourself of your budgeting why by creating a vision board of what your financial goal looks like. If you are saving up for a big vacation, find pictures of your destination and create a collage and post it somewhere where you’re going to see it on a regular basis. If you’re looking to pay off debt, create a collage of what your debt free future looks like. Having a visual reminder will help you keep the bigger picture in mind as you work towards reaching that goal.

Don’t Get Down on Yourself:

We are all going to have setbacks. Life is going to happen and sometimes that will mean that you have to go over budget or dip into that savings that you’ve worked hard to build. The important thing is that you don’t let it get you down to the point where you feel like giving up altogether. Yes it’s painful when you are faced with expenses that you weren’t anticipating, but don’t let that stop you from keeping your head up. Keep moving forward knowing that it will get better and that the end goal is still achievable, even with the occasional setback.

Your Turn!

  • How do you keep yourself motivated while on a budget?

How to Save Money

Confession time – I’m a natural spender. I always knew that I should save money, but I never knew how to save money. My idea of saving money was getting something on sale. Sure I spent $25 that I probably didn’t need to, but I “saved” $75!!

 

In order to get our finances in order and get our debt paid off, I had to go from being a spender to learning how to save money. This transition is not always easy, but here are 5 simple things that you can do to start saving money.

1. Save Your Raise:

Any extra money that you receive that you’re not used to living on, save it before you spend it. This can include any bonus or overtime pay, raises, and tax refunds. Before it disappears and you have no idea what happened to it, put those extra dollars into a high-interest savings account.

 

2. Save Your Spare Change:

Every day or at the end of the week, empty your pockets or coin pouch into a jar and watch the savings grow. Since we use cash for most of our daily purchases, our change adds up quickly. In 2016 we accumulated $160 in loose change which was used to purchase the gifts for our two daughter’s Christmas stockings. Not a bad way to use those coins that would normally weigh down your wallet.

 

3. 52-Week Challenge:

If you’ve spent even a minute on Pinterest, than you’ve probably seen this savings trick. The idea is that every week you save a predetermined amount of money. You start by setting aside $1 on week one, $2 on week two, so that by the time you get to the last week, you’re saving $52. Follow this and when the year is up, you will have saved $1,378.00. There are many savings challenges out there depending on what your goal amount is, and the reason why they work is because the savings goal for each week is a manageable amount therefore making it easier to stick with.

 

4. Pay Yourself First:

Another way to save money automatically is to pay yourself first. If you have your paycheck directly deposited, talk to your Human Resources department and see if they are able to split the deposit so that you have money deposited into your savings account with each pay. You can determine how much you would like sent into your savings. It could be $25, $50, or even 10% of your earnings. Since it’s being put into your savings account right away, you’ll be sure to save it before you can spend it.

 

5. Have a Spending Plan (aka The Budget):

This is the biggest money saver of them all. Set up a monthly budget where you list your monthly income that is expected and deduct the various expenses that will need to come out. From the remaining amount you can determine how much you would like to set aside into savings.

No matter what method or methods you use to save money, the trick is to make sure that you are consistent and stick with it. Happy Saving!!

 

Your Turn!

  • What do you do to make sure that you are saving money each month?

Wants Vs. Needs

By night, I write about and share my budgeting and personal finance journey. By day, I’m a Grade 7 teacher who recently had the “Wants Vs. Needs” debate with my students as part of a Geography lesson. I’m amazed at the number of students who claimed that their PlayStation 4 is indeed a need that they absolutely could not live without.

It seemed ridiculous to me as I tried to convince them that although they would not like to live without these items (tablets, laptops, and TVs also made their list), they would in fact LIVE if those items were to be taken away from them.

Wants vs. Needs

 

But if I’m going to be completely honest with myself, I too have been guilty of blurring the line between what is a want and what is a need, and blurring that line has lead to overspending throughout my adult life. I could step into Target and within five minutes find ten things I didn’t even know I “needed”.

Part of breaking my bad spending habit was to truly define what in fact are my needs vs. my wants.

Defining Your Needs

After a solid half hour of debate, I finally convinced my Grade 7 class that a need is something that is required to survive and live somewhat comfortably:

  • Shelter (no mansions required)needs
  • Food (Fillet mignon every night for dinner doesn’t count)
  • Clothing (just not those $200 basketball sneakers)
  • Basic Furnishings (one TV is fine, having more TVs than people might be overkill)
  • Access to some form of transportation (including comfortable shoes if your main way of getting around is to walk)
  • Basic hygiene and personal care products (including access to medicine)

 

We could all agree then that anything above and beyond these needs could be classified as wants, and there is nothing wrong with wants, as long as you can afford them and you’re not putting them before your needs.

Once I had a solid definition of what in fact a need is, I found that I became much more content with what I have and the list of what I “needed” became much shorter. I also realized that a lot of those things that I thought I needed have simply become stuff. Luckily Ryan has already written about the purpose of stuff and the questions I need to ask myself as I begin the daunting task of decluttering in an attempt to simplify.

Your Turn! 

  • What item do you now realize was a want that felt like a need at the time (Hint: Mine may have been a red pair of heels)

Checking in With Your Budget

When we first started budgeting many years ago, the biggest mistake we made was that we never took the time to check in with our budget. I was under the false assumption that once the budget was written everything would just magically fall into place. This was certainly not the case.

Our financial picture only started to turn around when we not only made our monthly budget, but more importantly, began regularly checking in to make sure we were sticking to the budget. Let’s look at some of the ways you can manage your budget on a daily, weekly, and monthly basis.

Budget Check In

Daily Budget Check Ins:

If you love your smartphone, you’re about to love it even more when it comes to sticking with your budget. With many apps available, you will be able to establish and manage your budget on a daily basis while on the go.

One of my personal favorite apps is Mint. It’s user friendly and you can link up your bank accounts free of charge, allowing you to track your spending in the various categories of your budget which you can also create using this app.

Everydollar and You Need A Budget are two other budgeting apps available to use. For a yearly fee you can link these apps to your banking information. The one advantage of these apps is that you can have two people access the same budget which is great for both you and your spouse to stay in the know.

My one complaint with the budgeting apps is that the purchases made aren’t always categorized correctly so you do have to go in and edit as necessary.

budget pen calculator

Weekly Check Ins:

Since I’m a paper and pencil girl at heart, this is my go to. Every Friday I’ll sit down with my online bank statements from that week, receipts, and my budget and start entering in what I’ve spent and add it to the previous week’s spending. This weekly check in allows me to see where we are in each of the budget categories and how much room is left.

 

Monthly Consolidation:

This is the most important step when checking in with your budget. At the very least you want to make sure you consolidate your budget at the end of every month before the next month begins.

When consolidating my monthly budget, I’ll add up the total amount of income and subtract all expenses. At this point I can ensure that we didn’t overspend, and that with any luck, more money came in then went out. Any money left over we then put toward our debts until all of our debt was paid off.

stay on budget

Once you start paying attention to your budget and track your spending, you’ll really feel as if you got a raise. Paying attention will cause you to spend within your means, if not below your means, freeing up a lot of the money that would have slipped through your fingers to now put towards a more important financial goal.

 

Your Turn!

  • How often do you check in with your budget?

How to Make a Budget

If you’re looking to get control of your finances the first thing we need to do is make a budget.budget

If that word makes you squirm and you assume that a budget means not being able to have fun anymore, please know that I felt the same way too. I can assure you though, after 3 years of making a new budget for each and every month, I’ve found that living on a budget has not been restrictive, it has been freeing.

It gave us permission to spend what we could afford which means there is no more guilt coming home from a shopping trip because the purchases are planned and budgeted for.

 

Wait…Did you Say Monthly Budget??

You did read that right. Yes, my husband and I make a new budget for each and every month before the month begins and here’s why you should consider it too:

  1. Some months we have 4 paychecks and other months we have 5. We want to make the most of our income each and every month, so by setting up a monthly budget we can be sure to make the most from that “extra” paycheck
  2. You may not have the same expenses every month. Although many of your fixed expenses will occur every month, other bills might not be due every month. My water bill comes in the mail every 3 months and thankfully I don’t need to plan a birthday party for my children every month.

computer budget

How to Make a Budget 

  1. Start with your total income: At the top of your paper, you will write down all expected income for the coming month.
  2. Subtract your fixed expenses: The first group of expenses I take away are the fixed expenses that pertain to the four walls, the expenses that allow me to continue living where I live and get back and forth to work. These include Mortgage/Rent, Utilities, Transportation (loan payment if applicable and fuel), Groceries, Minimum Debt Payments, Clothing.
  3. Subtract your variable expenses: These are the expenses that can change from month to month or are considered the nice to haves. Think Magazine/Newspaper Subscriptions, Personal spending money, Dining out, or Entertainment.
  4. Find out what’s left: This is the moment of truth, it’s time to subtract your fixed and variable expenses from your total income. If you have money left over, this is the money that you can use to put towards paying down debt or set aside for long-term savings.If you have a negative balance, it’s time to look at ways to cut your spending (link to future blog) or increase your income (link to future blog).

balance income and expenses

Bringing it all together:

Now admittedly, I’m a pen and paper type of budgeter. You may feel more inclined to create a spreadsheet. Regardless of how you prefer to budget, the important thing is that you are taking control of your finances and telling your money where to go instead of wondering where it went.

If you are a paper and pencil type, this is my all-time favorite template to use. If you think a spreadsheet might be more your style, you can watch my husband and I give you a quick tutorial on how to set up a basic budget using Excel.

 

Your Turn!

  • Are you a paper and pencil type or a spreadsheet type?
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