Date Night Club (April 2019): Busting Out the B-Word
Let's start with an icebreaker question ...
What’s your partner’s money superpower? What’s one strength they have when it comes to money?
This month I’ll be whipping out the big, bad “b-word”...
Budgeting that is :). Did you know that only 41% of Americans say they use a budget? While budgets tend to get a bad rap, I think they are a really important tool to help you meet your financial goals. Already tuning me out? Give me a chance! Let's have some real talk about budgets.
Here's why I think budgets are so important ...
As Dave Ramsey says, “A budget is telling your money where to go instead of wondering where it went.” While I may not agree with Dave Ramsey on everything, we do see eye to eye on budgeting.
A budget, or a spending plan, is the best way to make sure you’ve got enough money to cover today’s needs, give generously, and stretch to save for tomorrow’s goals. If you’ve got big dreams for your financial future, you need a roadmap to get there and that’s exactly what a budget is. Think of a budget not as a fence to try to contain your money but a road that leads towards those goals we’ve been talking about for the last few months. A budget is just as much about the future as it is about today.
And the best part – there’s no one right way to budget. You can make it as strict or as loose as you like. Tailor it to fit you and your partner’s unique style.
Your budget is the key indicator light to tell you how you’re doing today and what progress you’re making toward your future goals. That’s why I’ll encourage you to check back in with it at the start of every money date night going forward.
In this month’s video, I’ll walk you through the key steps of budgeting ...
Do you have a budget ...
Is the system we use working for us both?
Does our budget need to be updated based on our learnings from tracking our spending?
Um, not so much …
That’s ok. Today is your day to get started! Go back to the system you used to track your spending – a notebook, a spreadsheet, or a tracking app (like Mint)and begin to categorize your expenses. Feel free to be as broad or as detailed as you like. Wondering what categories you should use? Check out this basic monthly budget worksheet from the balance. Once you’ve categorized everything be sure to add up all of the expenses to see the total amount of money you are sharing, saving, and spending today.
Once you’ve got your expenses totaled up and organized do the same for your income. What income streams do you have coming in? Are you living above, below, or within your means? How much is leftover at the end of the month?
A few words of caution ...
This isn’t the time to idealize. Don’t sit down to create your ideal budget, make a budget based on how you are living today. Want to make a few lifestyle changes? Sure! Begin with a realistic budget and then make a few tweaks at a time. If you try to change everything at once, you’ll end up failing (and feeling pretty guilty). Give yourself some grace.
Give yourself some breathing room. One of the biggest mistakes I made with budgeting early on was to eliminate all of the extra money from my budget. My spending/sharing/saving and my income were a perfect match. That worked out great until the unexpected happened! Give yourself some wiggle room with money that isn’t allocated – you never know what might come up over the course of a month.
Every month is different. Just because you tracked your spending for a month doesn’t mean you have every annual expense included. What about the registration tabs for your car? Christmas gifts? Quarterly (or annual) payments for insurance? Include what you know about now and add in these other expenses as they come along. Do your best to save up for these expenditures throughout the year so you can take a proactive, not reactive approach.
Before we bring this date night to a close, let's check in with your goals ...
Do you think these goals still fit? Do you need to make any changes? Don't be afraid to make a change to a goal that is no longer serving you.
What progress have you made toward your goals this month?
What next steps (if any) do you need to take this month outside of tracking your spending?
See? That wasn't as hard as you thought!
Have questions about budgeting? I'm happy to help! Send me an email at: firstname.lastname@example.org.