Breathe new life into your budget

piePayday comes, the money goes into your bank account, you leave some in to cover the automatic withdrawals, pay some bills online, head to the grocery store, fill up the gas tank on the way and start your next pay cycle. Often with little or no thought to how well it is working.

I have noticed an interesting trend in the financial counselling world. We tend to get far too comfortable with our budgets (or lack thereof), sort of going on auto pilot and getting through each week, month, year. This is especially true if you live in the comfort or desired zone (versus the Survival zone). And that’s ok. If you have absolutely no desire to redirect any of your money to something much more fun than paying the bills, stocking the fridge, and driving the car. What is my point, you might be asking? Let me answer that with a quick story.

A few years ago I had a discussion with a family member. Her husband had lost his job and as a result she had to stop what she had always been doing and look at it closely, because they needed to cut back to make ends meet until he got another job. By simply paying attention, she cut her grocery bill down by $200 per month. They still ate well (healthy eating is very important to them) and didn’t run out of food. In fact, she reported that they threw less stuff out. Now she made this change because they had to cut some money our of their budget. What if she had done this when they didn’t need to cut back? That $200 per month  could have gone anywhere else but the grocery store – pay down debt, family vacation, shoes (just sayin’), etc.

Sometimes you just need to pause…take a few deep breaths…and look at things from a different angle. Then ask yourself, “what can I do to make this better?”. You might be surprised at the answers that present themselves.

Take the following 5 steps to day to breathe new life into your budget:

Be aware! – if you are very good at keeping records, pull together what you have for the last year, and figure out what you spend, per month, on your day to day expenses (gas, groceries, kids activities, coffee, entertainment, etc.). If your record keeping skills could use some improvement, commit to keeping track going forward, for at least 3-6 months.

Look into the future!  – Ask yourself, “If I could save $100 or $200 per month, where would I want that money to go?”. There is no point in setting an objective to save money if you do not have the motivation of the dangling carrot to keep you on track.

Pick an expense! Any expense!  – Envision for a moment the money that you work hard to earn leaving you and going out to the many places it goes in your budget. Then ask yourself,  “Which of these am I willing (anxious) to spend less on to assist me in redirecting my money?” I don’t know about you, but I would prefer to take a family vacation versus supporting our local grocery chain.  Don’t try to work on everything at once, choose one expense that is less important than the goal you set.

Play with it! – Start looking at ways to spend less. Make it a game. Involve others. As an example, change your grocery shopping habits. Try buying in bulk, or flyer shopping. Plan your meals or make more meals from scratch. Track your results and put away your savings.

Reap your reward! – Be grateful to yourself for achieving your goal, involve other family members and celebrate the success! Settle into a new spending pattern for that one expense and pick the next one to tackle. Above all else, have fun!

Happy Budgeting!

 

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