Oh my! It’s that B-word again. I actually try to stay away from this particular word and instead call it an Income and Spending Plan, which is exactly what it is. As soon as people hear the word “budget,” they feel trapped or fearful that having a budget will be restrictive in some way. The opposite is actually true. A budget allows you to clearly see your income, and it allows you to spend your money with purpose, on “purpose.” A budget is merely a plan for your money, of which you have control over, and it is not meant to put any kind of chokehold on your daily living. It’s a tool that’s meant to support you in being intentional with your money.
A budget also acts as a guide in helping you achieve your goals–whether that’s keeping a watchful eye on your grocery bill, reducing your credit card debt, or saving for your future dreams.
You’ll actually have more freedom to spend once you create an intentional plan. After you designate a certain dollar amount on your expense categories, you’ll then be able to spend money without feeling guilty. Now, that’s true freedom!
6 Monthly Budgeting Tips for Intentional Living
1. Make a list of what you value most. It’s helpful to know what you truly value in life. My guess is, it’s probably not buying stuff, but rather spending time with those you love, new experiences or peaceful moments. Understanding what you value most in your life gives you an opportunity to make the choice to allocate your spending to those areas and eliminate frivolous spending.
2. Budgeting date night. If you’re married, sit down together at the beginning of the month for a family budgeting night. Make your favorite meal or snacks and listen to music in the background that will help keep you focused and keep the mood light. Dream about what your future will look like together and be a team in creating your budget.
How to make a budget: List your income (all sources: work income, any pension income, and side gig income), and then list your expenses. You’ll want to include your fixed expenses first on your budget: shelter, transportation, utilities, and food. Then go ahead and fill in the remainder of your budget categories: clothing, haircuts, gifts, vacations, memberships, etc. Now, subtract your expenses from your income. If the number is negative, look at where you can cut back or get extra work to cover it. Also, ask if you’re spending in alignment with what you value most in your life. If the number is positive after subtracting your expenses from your income, you might choose to pay down your credit card debt, if you have any, or move more to savings.
3. Aim to be credit card debt free.
Paying off your credit card debt should be a top priority. I don’t need to tell you what it’s costing you every month. Look at your statement and you’ll see exactly what I mean. Debt robs you of so many things: sleep, disposable income for fun activities, and saving for a better future, to name a few. A good strategy for paying off your debt is the Debt Snowball Method.
4. Don’t be afraid to sacrifice when needed.
There are times you might need to trim the budget. That’s okay. When times are tight, you can save money quickly by canceling cable, and shopping at discount and consignment stores for clothing and groceries. Remember, this is just a temporary sacrifice to get you to your goals quicker.
5. Stay on track and in the driver’s seat of your financial life.
This might be one of the most important budgeting tips, because if you do all of the above but don’t have a way to measure your progress, you won’t really get a clear picture of how your actions are, or are not, having an impact on your finances. Track your spending every month. There are several great options out there to help you stay in control of your financial life. Mint is an easy to use and free monthly personal finance tracker tool, and it’s free!
6. Stick to it!
It may take awhile before you feel you’ve got this budgeting thing down. Stick to it and you’ll begin to notice that your deliberate actions are paying off, and you’re more disciplined with money than you ever thought you could be. You may make a few mistakes along the way, and that’s okay. Just keep going!
When you understand that the purpose of budgeting is to actually give you freedom and not to limit your life in some way, you’re well on your way to a fulfilling and prosperous life.
Cheers to your financial health and wellness!
