THE HOME YOU'VE GOT >
Let's not make this too hard... I know you can
find books and articles on how to set up a
personal financial budget for yourself. And I know
that sticking to a budget can be as hard as
sticking to a diet... unless you're really going
to envision a better outcome - a better
way of life that will support your real desires to
be change, to experience life differently.
Here, I'm going to concentrate on some personal
budgeting basics - ideas you can put to use right
away in your thought processes.
First, no matter what sort of budget you wish to
set up for yourself, a detailed chart on paper or
simply rules-to-live-by in your head, you need
some help prioritizing the many types of
expenditures that come into play. So let's look at
a simple system of categories - kind of like
numbering things from 1 to 4 in importance... but
this way you don't have to remember which number
- Real needs (like rent, insurance, food
- if you're already frugal)
- Needs but might be adjusted (like lower
rent, lower insurance rates, less specialty
food/eating out, etc.)
- Major wants (that which will contribute
greatly to your happiness, fulfillment, joy)
- Fluff (this is stuff you can do without
- sure you can!)
When you go to analyze the many things you do
spend money on, it might be just as easy to type
up the list right into a 4-column chart (in a word
processing program or a spreadsheet) headed by
these categories - and then move the items into
different categories as you adjust your thinking.
Or, you can assign numbers to the categories and
annotate a written-out list of your
Or have some fun with it: put the category
columns onto a poster, write each expenditure on a
sticky note, and stick them into the column (so
they're easy to move around).
Or just imprint the categories on your brain and
bring them to mind whenever you come to question
an expenditure (and make a habit of
questioning them). Whatever you like best!
...As long as you're actually thinking about
what you do, you'll be steering yourself into
personal budgeting, even without charting
everything you get and do.
Now, there are two other focus points I'd like to
- Paying yourself first
- Saving for the future
I know, they sound like the same thing, don't
they? - and a lot of money mavens consider them
so. But to me, there are two different, and
perhaps equally important (that's for you to
decide), things here:
- Paying yourself first, socking away something
for what you greatly desire - a dream
vacation, training for a new profession, the
ability to pursue a hobby, a lifelong goal, etc.
If you don't save for you, you're likely
to fritter away your financial capacity for
making important things possible - or steal from
the needful to make them happen (like binge
eating while on a too-strict diet) and get
yourself into financial trouble. (Of course, you
can pay into such an account with financial
- Saving for the future, for what you need
- retirement savings, yes, but also setting
aside enough money monthly to take care of those
"surprise" annual or semi-annual expenses such
as insurance premiums and tax payments. Get this
money out of sight and out of mind (i.e., in
order to get a realistic view of your
discretionary income), or you'll be tempted to spend
what you're going to need later.
However, in either case, your action
amounts to the same thing. That is, you would need
to suck money off the top of your income to go
into these "holding tanks".
If your discretionary capacity is extremely
limited, your payments into the "pay yourself
first" account will be accordingly miniscule. But
establishing the habit of paying yourself
is good for your soul!
Bet the fluff can just go. (See Divestment
money-sinks for some help.)
Perhaps reading the page on Seeing
your true needs would help you
to grasp the difference between needs and wants...
and the importance of true desires in our
Does it seem like all this would take up too much
of your time? Remember that it's an investment, in
the establishment of new habits and in a better
life. As Janet Luhrs (of www.SimpleLiving.com)
says, "If you just shut off your TV even one night
a week, you'll have plenty of time to manage your
Another consideration I'll add as an umbrella
idea to the discussion of hows is this:
Staying home rather than going out (staying home
more often, combining errands, developing
home-based hobbies and/or businesses, maybe even
getting friendlier with your neighbors) can save
you a whole lot of money over the course
of a year.
It's all up to you, of course... but you can
find ways to save - and still enjoy life.