Match Your Budget To Your Values

How we handle our money and how we spend it shows us what our value system and priorities are.  It's true!  Have you ever taken a good look at how you mange your money?  For many people, this can be a scary thought because we know we aren’t handling money well.  For others, we have no clue what this will tell us because we’ve never thought about it. 

Are you responsible, disorganized, ignorant, cautious, fearful, generous, intentional, or a mixture of all of these?  Maybe you just don't care about it at all.  Are you a giver, saver, spender, or investor of your money?  What does this tell you about your enjoyment of life now as well as in the future.  If you don’t ask yourself these questions, it’s hard to tell if you are setting yourself up for a good life or a life that will be full of financial struggle.  That’s why most people who handle their money well will say the budget is necessary to succeed with their personal finances. 

Budgeting is a value system practice. A lot of times I sit down with clients and find that they feel guilty about the way they handle their money or their budgeting practices. They feel they aren't giving enough, not saving or investing enough, not in control of their money, feel overwhelmed or have a sense of dread when it comes to money.  The act of budgeting isn’t as scary as most people think.  It’s just putting a plan in place for the money you have, no matter how little or how much of it you have coming in.  This is critical for all people with incomes, not just the people who have a substantial amount.  Some make the excuse that they don't have enough income to budget.  Some say their income fluctuates too much to budget, and yet others say they have too much coming in and too much going out to track with a budget.  Have you ever said or thought any of these things?

I recommend everyone needs to put together a budget and start building this skill, and it doesn’t have to be elaborate.  It can be very simple (especially at first).  Here are a few simple things you can do to get started if you’ve never had a budget before. 

1. Take a look at your paycheck and write down how much you have coming in each month (it’s a good practice to use NET income - after taxes are taken out).
2. Look through your bank or credit card statements and see how much you spend each month (total)
3. Divide your spending into “categories” (not too many) like: Food, Household, Giving, Transportation, Health/Insurance, and Entertainment (you can look up other categories if you want to get more detailed)
1. You can add “line items” under each category as needed (depending on your spending habits)
4. Assign a dollar amount for each line item (you’ll take educated guesses at first, but after a few months, you’ll be able to predict these better)
5. Stick to your budget as best as possible, but each month you need to assess whether you should increase or decrease your line items based on your spending through the month.

**Match your budget to your values.  In other words, put money toward the things that are most important to you and you’ll enjoy the process a lot more.  Once I started doing this, I felt so much better about my money management.  It's so freeing to know that I’m putting money toward things that are important to me each month.  Don’t live your life on the "should’s" that others create for you.  Believe me, I struggle with this one all of the time.  I have these voices that tell me what I "should" be doing with my money and most of them are good things, but just because someone else says I should do this or do that, doesn't mean it's the best thing for me in my particular situation.  We each have to look at our lives, know what our priorities are, and analyze what makes sense for us.  Then, we allocate time and money to those priorities (within reason and in alignment with our family's input).  This will lead you to live your Ideal Life!

So, what is important to you and your family?  Take some time to jot down a few things you would like to put money toward and add them to your budget this month.  Yes, that may delay some of your other goals but that's why it's called "personal" finance.  It's personal. Each person is different. Some may think cable and vacations are more important than extra clothes and upgrading a car. Others may say that the car is more important than that vacation or even saving for a home. Others say getting rid of debt is more important than anything except the necessities for a minimal lifestyle. You must decide for yourself.  

Now is the time. Budgeting is the most freeing feeling you will have with your money and will help you achieve your goals that much faster.  If you need help setting up your budget or getting started, I’d love to have a conversation with you to get you on the path to Financial Freedom!  You can schedule a free Discovery Call HERE.