I, am always going through the painful journey of feeling like I’m living on a tight financial thread. I don’t remember a single time in my life where I haven’t been largely concerned with the number of dollars in my bank account, wondering if I will have enough to cover my expenses. That has always been my reality.
I’ve made choices in my life that have led me to a place of paying back debt, both educational and personal, and let me tell you – owing large sums of money is never a fun place to live.
But let’s be real here. If you are in your twenties, post-University, and you’ve come from a lower or sub-middle class family, you will likely have to carry some sort of financial debt and navigate the often awkward and painful life of tight-budget living in order to attain some more financial freedom. It’s okay, you are not alone. (Sending you a hug, because it can be really hard – I feel you.)
One day (in the likely distant future) I will want a home of some kind, and I would love to be able to afford it. I’m not there yet, but I’m training myself to abide by principles that will hopefully get me there. I’m not going to give you a detailed picture of where I’ve owed money and why, but it adds up to a few obligatory needs like school & vehicle, combined with a lack of responsible spending in my twenties. I’ve circled around in these formative years with paying things off and then sliding back in to more debt.
I do really believe a lot of the spending has to do with the need for more, sometimes to fill a void of meaning in your life. At least I know that’s why I spent money I didn’t have.
Yet, in the seeking budget help, I find the TV shows and extreme financial folks a bit much to handle…because, YOLO. Right? Those people are TOUGH cookies.
The goal is to be financially responsible, not to have more than I need. If spending a small, budgeted amount means I get to have a memorable weekend with someone I love in exchange, then I find that a valuable investment in the timeline of my life.
Where we find the trouble is in spending what we don’t have. We don’t have to have a lot (what each person has will vary depending on income, housing, & preferences) but where we have to live is within our means.
I despise extremes. Fad diets, black and white belief systems… I prefer all the shades of grey, in everything. Including budgeting. Extremes fail people. Diets. Religions. Budgets.
I’ve been using an equation that works for me and it is SO SIMPLE. Ready for it?
INCOME – NON-NEGOTIABLES = EXTRA SPENDING
Woah… definitely not rocket science, right? So, where’s the work then? It’s in deciding the non-negotiables, of course.
I’d like to provide you with a list of likely contenders for the non-negotiables:
- Car payment/insurance
- Phone bill
- Student loan payment
- Credit Card bill or payment
- Allocated amount to savings
Personally, I operate on a budgeting bi-weekly basis, as it aligns with my paycheque. The moment it comes into my bank account, the non-negotiables are out, moved into other accounts that aren’t connected to debit card. They are non-negotiable.
What I’m left with is negotiable, for extra spending.
A lot of people might think I’m bizarre for not including groceries and gas in my non-negotiables, but I don’t believe that’s true. It is totally negotiable how much you choose to drive your car, and what types of food you choose to buy. You can absolutely control and shift how much you spend on all things you physically purchase.
Negotiables can be budgeted and navigated depending on their importance to you and your lifestyle:
- Eating out
- Extras (movies, gifts, clothes, unexpected)
I’m finding that all of this simplifying business truly comes down to knowing yourself.
When you know what’s important to you, you can plan in a super efficient, meaningful way. Once I realized that I didn’t actually want to buy more clothes regularly, that what I really wanted was to love my clothes I have, that took off the pressure of even including it in my regular budget. Instead, I decided to simplify my closet instead of spend more. Once in a while if I need something, I’ll account for it during that pay period.
Everything is adjustable. If you need to allocate more money for groceries, take it out of entertainment or eating out. Budgeting is balance.
The big breath of fresh air I want to blow in your face is that there is hope.
Just because your finances may look dismal now, you can still be in control and start to make a shift. I’m 100% on the same journey. I used to look at a paycheque and think all of that money belonged to me, but now I look at that sometimes very small number at the end, and honestly, it’s not that bad.
In order to get ahead, you have to simplify – the experts do have that right.
I’ve had so many bad feelings towards money and finances in my life that it’s an absolutely incredible feeling to know that I’m working towards something – that I have actually started to save, and it’s become a non-negotiable to me now.
Budgeting is more often about leaving our pity party and choosing to change something.
And sometimes, it’s painful. I’m just about to sell my car. I’m doing it because it’s currently eating a huge whole in my budget, and I’ve decided that saving and paying things off are more important at this stage then my mobile freedom.
You are never stuck. You always have a choice. The tough choices can result in such an inspiring freedom though.
Last hot tip: Make a simple Excel spread sheet. Get real with the numbers. Don’t leave anything out. Play around and find what works for you. Don’t be too harsh, but be committed. You might be surprised at how much control you actually have.
Don’t lose heart. You’ve got this!