Budgeting is Boring – Part 1
Well, since we've moved to Salt Spring, budgeting has become a necessity. I'm now following a new direction with my business – and not taking on any new clients. Duncan is no longer working a 'normal' job as he is renovating the house.
What we have found from budgeting is that we spend less… No surprise there eh?
Well, actually I was surprised. Usually it doesn't make any difference…
But it's amazing once you sit down and come up with a REASONABLE budget – how the urge to spend naturally reduces.
Now I stress the word REASONABLE. Most people think of budgets as a CONSTRAINT – something that is 1) a hassle, 2) stops them having fun, 3) is boring and 4) takes too much time. (Sorry Mom! She's an accountant!)
Well, we now have a budget for alcohol, for weekends away and holidays, for personal expenditure (which we don't need to justify to each other), for entertainment (eg. dvds, eating out) and for 'treats' which might include a massage or occasional bottle of champagne.
Now some of you may be thinking "That's not a budget!". But I think that's why it works. Because it DOESN'T constrain us. We SPEND LESS, it's EASY and FEELS GREAT! Because it maintains our dream of living here on Salt Spring (for the budget to work – it helps if it's linked to a goal or dream).
I used to buy all sorts of little 'treats' while I was out – and they really added up. Of course I didn't NEED any of them. With a budget, I realise it's going to impact the budget we've set, so I resist the urge to buy – get home and feel great!
And we actually have massages now, we still eat out and have treats. But it's guilt free. And did I mention we SPEND LESS?
My theory is that we spend less on 'stuff' here and there which can really add up. We have also identified our biggest costs – for example groceries. And have identified ways to spend less on groceries without shortchanging ourselves. That'll be the subject of another post…
People spend a lot of money WITHOUT really thinking WHY (even small amounts add up!). And without considering longer-term what ELSE that money could go towards.
That regular latte or lunch 'out', new hair styling product, beauty cream, jewellery, piece of cake, CD, latest phone. Are you just satisfying a perceived (and sold/advertised by big business) 'need' which will wear off? Or would you rather put that money towards owning your own business, living in the country, travelling the world, moving to an island somewhere, retiring early etc.
Your dream may seem too big, too far off, but if you save – you'd be amazed what you can achieve in just a few years.
We have found that setting a REASONABLE budget, tracking our REAL spending and seeing where our 'LEAKS' are is EMPOWERING and fun. It's our newest challenge!
When people tighten up their spending - they often find they're closer to their dreams than they realise…
Think budgeting is boring? At your peril! Money is power and freedom – keep it for YOURSELF!
Want help with budgeting? Ask for Sheila at http://www.moneyreallymatters.ca/
Ah yes money & budgets …….. or would it be more accurate to say “desire combined with consumerism conditioning as relating to our core desires, fears and wants by the likes of Edward Bernays et al”.
To start to construct a budget it makes a few people face their understanding of the difference between “need” and “want”, and what motive(s) is/are satisfied by the “getting” of something that they believe is “needed”.
Depending on how that internal dialogue goes and how self-aware the person is I dare say that will highlight some aspects of why people don’t face the “fear” of dealing with the finances. Whom at the same time may be focusing on the ironic opposite of taking responsibility and authority over their own finances, as something limiting or restrictive.
Identifying a need and a want can be a scary thing as people have to face their own behaviours and desires some times and habits and look for the real motivation of them.
Though fear and pain, awesome opportunities to grow …….. and to end up with a clear understanding of what ins and outs are of incomes and outgoings and how much play money there is, I dare say is a valuable reward.
It was for me.
Doing my own budget and recording my outgoings was the best money “making” or freeing exercise I ever did.