Updated insider information by Chellie Campbell, author of “The Wealthy Spirit: Daily Affirmations for Financial Stress Reduction”
16 – January 16
“It’s amazing how fast you can go through $7,000 with beer, pizza and The Gap.”—Ben Affleck
What is your reaction to the word “budget”? A sinking, depressed, deprived feeling? You are not alone. Many people audibly groan at the mention of the word. For the vast majority, it connotes scarcity, lack, and limitation—none of which are very pleasurable concepts. “Budgeting” in common usage usually means cutting the fun, frivolity, entertainment, and spontaneity out of your life and creating a bare-bones, austere, nothing-but-the-basics spending plan—something you do when you’re stressed about not having enough money.
That is not my idea of budgeting. I have reframed it above: It means designing a spending plan to achieve your number one priorities and get all those things you reallywant. A budget is telling your money where to go instead of wondering where it went! This can and should be a very enjoyable process and not the bitter, restrictive pill you fear.
It is important to know that a budget is not written in stone. It is a flexible, adjustable plan that reflects how you give valuable products or services to others (income) and how you choose to support others by buying their products or services (expenses). All of these are decisions you make, therefore you have the power to change them. We often feel so trapped by our previous decisions that we think that we’re stuck, but a closer examination will reveal that we can change everything if we are willing.
The power of budgeting is that we decide before each month how we will spend our income, then as the month goes on, we write down our actual income and expenses. When we tally up the score at the end of the month, we can see whether or not we want to change our decisions for next month. Design a plan that works for you and then work your plan!
Today’s Affirmation: “I happily spend the money I make in all the wisest ways!”
I hear the wall of resistance going up all over the land.
I know how difficult it is to face the reality of your numbers. Chill out, darlings. EGBOK. Everything’s gonna be okay. Breathe. Relax.
Here’s the truth: your numbers are your numbers. They exist and they are real. Whether you know what they are or not.
Can you see the danger that lurks in not knowing? How are you going to make an informed decision about how much to spend on your vacation, or birthday party, or your daughter’s wedding, or Christmas presents, or a new car if you don’t know exactly how much money is coming in and going out of your bank account? Can you afford to buy that house? How would you know?
If you’re nervous or scared about your finances and feel out of control with your money, you probably don’t have a budget. So start one now. You don’t have to buy a fancy program and learn how to install it and use it. Just use an excel spreadsheet. Put columns down the left hand side and label them income and expenses. Next, put a column on the right for your budget amounts – what you plan to spend on each line item. The third column to the right of that one will be what you actually spend.
It may take an hour or two to set it up, but after that it only takes about 2 minutes to log your numbers in every time you pay your bills. You’ll see what you spent, what bills are still due, and how much money has come in, and what’s left. This is the greatest management tool ever.
Because you won’t be able to lie to yourself about your spending any more.