October 2017, I struggled to stick to my budget and that’s coming from a hyper-budgeter. I kept going over my spending budget and having to adjust the next paycheck to accommodate. This was a vicious cycle that I knew I had to break. And after months of tweaking my plan, I had to change my money rules and change my mindset! There are so many rules, theories, and practices with money! Which one is right? Sometimes it is easy to fall into one of those routines without questioning if it works for you! I made the decision to make my money work for me. Here are the steps I took and resources I used to get back on track. Can you relate?
I maintained certain percentage rules and other rules that didn’t work for my income.
Each month I organized my budget into preset categories that didn’t work well for my income. How did that end up? I transferred extra money to my spending account, adjusted budgets mid pay period; breaking money rules my rules.
This was exhausting! Why did I put in work to budget if I was going to change things up? This produced little discipline and self-awareness.
My remedy? Change the initial budget amount or attempt to predetermine spending money. I ended up incorporating a mixture of both that has been working! I found a pattern in my spending and bumped up that budget a bit. Then, I started to pre-plan dinner dates, lunches out, and other spending. I found it easier to budget for “spontaneous” activities.
Before opening a second checking account; I used the same account for everything. Bill payments, spending, and short-term savings. It became complicated to figure out how much “extra” money I had to spend when I had to keep track of pending payments.
For a long time, I thought owning many checking accounts complicated things. Little did I know, it made segmenting my funds easier. This also increased access to my money (as opposed to using a savings).
With my new checking, I transfer my spending money for daily expenses. My primary checking is all for bill payments. Segmenting my funds made life so much easier. Account fees are still a thing, but that’s a small inconvenience for better money management.
My savings were sporadic and in my mind, optional. We’ve all had a time in our lives when savings seemed like an afterthought. Only when we changed our mindset to see it as a given, did it become easier. I’ll admit, it took me until my 24th year on this earth to figure out the right savings plan for me.
I assumed a basic savings account with my bank and monthly deposits would cut it. As long as I kept those consistent, I would rack up the funds I’d need later on. That included an emergency fund, vacations, car maintenance, etc. I put it all in one pot! And why did I do that? Because savings only got one measly line item in the budget. I thought of it as this catch-all money boat for hard times.
Although I caught on to this before October, I didn’t reap the benefits of my changes until recently. I’ve been in love with the Qapital savings app since I found the right workflow for myself. I segment my savings into goals now. For example: my wedding fund, future apartment, and vacations. Each goal has its own pot, divided and recognizable.
This small mental shift and the new app has me excited to see my savings grow and automate the hardest task.
Keeping Status Quo
There were a few tricks that worked well for me when I was still in school and making less money. I, unfortunately, kept those budgeting hacks when my cash flow changed. I did not notice that I had to make a money management change when my income changed. For example, I used to split up larger bills between checks to make them more manageable. This was a great plan for a student with a smaller income. It also allowed me to breathe a little and spend.
With my new income, that became a problem as I struggled to figure out how much money went where. I also found myself (again) calculating what I could spend or save based on how much was set aside for future bills. It got out of control!
Now I split my bills by payday. Bills due at the beginning of the month, get paid at the end of the previous month. Those due in the middle/end, get paid on the opposite check. I do not hold on to money for future bills. I pay what’s due, in full, right away.
This has made tracking and budgeting soooo much easier! I can glance at how much I have available and not have to do extra math. This has freed up much mental space and stress.
Created A New Budget
I managed to incorporate these new rules by tweaking my budget template bit by bit. The budget started as a simple table with estimated bills per month. I wanted a snapshot of how much money I needed as a salaried adult for the first time.
As I discovered more and more about my financial habits, I changed things. I now pre-plan bills, spending money, savings, etc. I plan to the last cent and I still feel free with my money! Using the bill pay strategy, automatic savings and pre-plan method changed the game!
It may seem strict and unforgiving, but I am used to it. Once you find your perfect flow, it will feel the same way too. I challenge you to download the B Chic Budget Template to find out for yourself. The workbook provides a detailed roadmap but also offers flexibility. I promise you’ll find your best money rules and freedom with it!
I found my workflow and my relationship with money is becoming a healthy one! Yours can too, it takes a bit of planning, trial, error, and refinement.
Download the B Chic Budget Template today and start figuring out your next budget!