Budgeting Tips to Save Money and Live Your Best Life!
A balanced individual understands the importance of budgeting. Up to know, most of my blogs have centered around management, leadership, and business. However, this blog should serve as a bridge that connects more than one principle. Finding true balance, or a bridging mindset is to understand and excel in other departments than what we are used to.
Some viewers will have depleted savings accounts, maxed out credit cards and perhaps even a paycheck away from financial disaster. Maybe you’re doing great, and you earn 6-figures, but you don’t really know if you are budgeting correctly. So, let's dive into the art and science of budgeting, a vital skill that can transform your financial life.
The Budgeting Conundrum
We’ve all been there! We promise ourselves to start budgeting next month, but then life happens. Unexpected expenses, maybe your car needs a new battery, or if you’re like me, my jeep that i sold had engine issues every single month! there could be social pressures such as get togethers, birthday parties or family events. and even the simple complexity of managing money may feel like a challenge. The real obstacle is not just creating a budget, but sticking to it consistently. And that’s true for many things in life. Consistency is key. And managing our money, or budgeting, is no different. To some, this challenge can feel like climbing a mountain with no gear on. The truth is, budgeting is more about mindset than math. It requires us to face some of our bad habits. I spend way too much money on coffee. But I LOVE supporting local coffee shops and it’s a weekly routine that my wife and I have every weekend. Some months I spend more than I should eating out instead of cooking. And when you are budgeting, a lot of these decisions will pop up when you begin plotting your monthly expenses. The mental challenge is having to say no to purchases you may want to do impulsively. Budgeting is about changing your relationship with money and viewing it as a tool rather than a source of stress. It’s another tool that we can all use to help us succeed in life. So, how do you overcome this mental and practical hurdle?
Mastering the Budgeting Game
To navigate the budgeting maze, you need a clear, actionable plan.
Step 1: Set Clear Financial Goals
Before you even start budgeting, identify what you want to achieve. Is it saving for a house, paying off debt, saving for a wedding (like I am)or building an emergency fund? Clear goals give your budget purpose and direction. The goal will also outline how aggressive you should be with your budgeting. If you’re starting to budget because you can’t afford your next payment, then the severity of you budgeting is a lot more intense. Here, you should really focus on being consistent. However, maybe you’re budgeting just for side money that you will use on a vacation. Perhaps there, the incentive may not be as strong. Outlining your goals will help you place this into perspective. Also! write it down! put a sticky note where you can see your goal.
Step 2: Track Your Income and Expenses
You can't manage what you don't measure. Start by listing all your sources of income and tracking every expense. I have a budget planner on my website for sale, however, if you comment “tracking” ill email it to you for free. Ideally, you a budget planner that has graphs that visually shows you what your revenue, expenses, and profit look like. This way, you can compare month over month, quarterly, or even year over year, what your habits look like. Now, that may sound like business lingo, and it sure is. Treating our personal expenses like we do at work or at our business can help us manage our life in the same professional manner we do with our jobs.
Step 3: Categorize Your Spending
Break down your expenses into categories such as housing, utilities, food, transportation, entertainment, and savings. This will help you see where your money is going and where you can cut back. The budget planner I have has all these already broken down. but, categorizing is puts it into perspective. for example, when i said that one month I spent a lot of money eating out, well it may not sound so bad, however, when you can categorize it and say, wow, i spent more money eating out than groceries, ehh thats a problem. Or, i spent $700 dollars in alcoholic breverages and parties. that’s a car payment. so categorizing will show you your habits. It will reveal where you spend the most.
Step 4: Review your income
Now, allocate your income to each category. if you only have a salary from your job then it may not be too difficult. however, the goal is to create various sources of revenue. you can have dividends, rental payments, side hustle revenue, etc. but you do want to categorize this area as well. Make sure your expenses don’t exceed your income. IF they do, then you should review the categories and see why, create an action plan for next month to ensure you dont do the same habit.
Step 5: Monitor and Adjust Regularly
Your budget is a living document. Review it monthly to track your progress and make adjustments as needed. Life changes, and so should your budget. and it is a truly amazing feeling when you see the charts of your budget planner and all the green is higher than the red, your savings (profit) is increasing monthly.
From Chaos to Control
I began budgeting since 2016. I was 20 years old, had just came back from Iraq and I had more money saved up than i ever thought I would. I don’t even know what caused me to create a little budget planner on excel. But i did and I am grateful. I tracked my revenue and made sure that my expenses never went over, despite the money I had. i basically just held the money in my bank account for years lol. but, as i grew older and I climbed the corporate ladder, i realized that lifestyle creep began happening. In 2022, I made far more money than I did in 2021. However, i actually saved more money in 2021. There’s a lot of reasons for that, repairs on a house I rent, new vehicle of course, youtube studio…maybe? lol but my point here is, that your profit is heavily impacted from your expenses, just like your revenue. Budgeting and monitoring those expenses will show you, just like it showed me, (Im married now), that expenses can come, and hit hard. So keep track!
Transformation Through Budgeting
Budgeting isn’t just about limiting your spending; it’s about empowering yourself with financial freedom and peace of mind. By setting clear goals, tracking your expenses, categorizing your spending, creating a budget, and regularly adjusting it, you transform chaos into control. The journey to financial stability and success starts with a single step: deciding to budget. Embrace it, and watch your financial life transform.
Budgeting is a skill that, once mastered, will serve you for life. It’s about making your money work for you, rather than the other way around. So, start today, and take control of your financial future. You’ve got this!
