The Budgeting System that (finally!) works for me

August 2, 2020

This post is part of a 5-part series that I lovingly called my “Getting my Sh*t Together Series” where I dive into the 5 areas of my life that have helped me establish the foundation of my life outside of work so that I can focus on going above and beyond in my day job and passion projects. Check out the intro here, and sign up for emails to know when the next deep-dive posts are live.

Understanding your finances is a major pillar of sustainable success. Stressing about money is an unrelenting hindrance to growth and well-being. On the other side, feeling stable and secure in your finances is an incomparable foundation for pursuing the life that you want to live, working the job you want to have, enjoying your dream hobbies, taking care of your health, and so much more.

Understanding this means knowing where you are now financially, where you want to be (and learning about where you can be!), and knowing the steps needed to take you from here to there. One of those big steps is making and keeping a budget.

Myths and Limiting Beliefs

Before we jump into some background and what has (finally!) worked for me, let’s first bust some myths and limiting beliefs that I had to reframe before I found success in budgeting.

  • Myth: Money is inherently dirty/evil/bad
    • Money, power, and technology are the three amplifiers: with them, the good gets better and the bad gets worse. So while, yes, some people do bad things with money, I know I will do good with my money by giving back to my community and purchasing items that support causes I believe in. I even dream of one day being an angel investor for companies that are doing good things in the world. I will use money as a megaphone for what I believe in.
  • Myth: A budget is too restrictive and rigid to work for me sustainably
    • Here’s the straight truth: there is no such thing as a normal month in budgeting. A real, sustainable budget is adaptable, and it flexes with your life. If you’ve ever built out a “monthly” budget only to have it not fit your expenses two months in a row, congrats, you are a human living an unpredictable life! Welcome to the club, time for a new budget paradigm.
  • Myth: There is a “right” way and a “wrong” way to spend or save my money
    • Strict, blanketed rules like “housing should only ever account for 30% of your expenses” and “never use credit cards (or the devil will get ya)” are bologna. There are good guidelines from wise teachers that you can incorporate into your financial life, but for your finances to flourish, you should prioritize your spending and saving according to your personal goals and values. I have a monthly budget line item just for “education” because I know I will spending money on books, online courses, and more and LOVE IT. And that means I don’t have as much to spend on things that don’t matter as much to me. Which means I’m doing my budget “right” after all.

My Financial Background (aka when things were ugly)

I started on my personal finance education journey almost immediately after college; I knew I was going right into a job that paid me well, and I wanted to do my best at managing it. I was pleasantly rocking along, very passively engaging with finances until my relationship ended and I was suddenly left with a rent payment that I was solely responsible for, all of the extra costs associated with moving out of that house ASAP, and an emergency fund savings account balance cut in half.

After the split and a nasty unexpected tax bill, I was sad and scared every time I looked at my bank accounts. Despite this, I used retail therapy to cope and found myself wondering where all my money was going at the end of the month.

Turning Point

When I received the job offer for the role I’m in now, along with a 20% pay bump, my fear amplified. I didn’t want to waste this extra income buying useless crap on Amazon, but that’s the path I was on. I set out to find a financial teacher and discovered Darcie with Green Bites Project. She was leading an online course — my favorite way to learn! — called “Grow Financially Well“. It promised to walk through the basics of budgeting, debt, money mindset, and wealth building. I dove in and LOVED IT. While that last topic was the one I was most interested in, I am forever grateful for the learnings throughout the course.

I applied everything I was learning in parallel with learning to use YNAB, a budgeting software called You Need a Budget (its abbreviation is pronounced why-nab!), and I am a total fan girl now. The learning curve was STEEP, but I am in control of where my money is going, what my goals are, and how well I’m taking care of myself. (Disclaimer: the link above is a referral link so you get 34 days free to try, and I get a free month, too! Heyyy!)

Recently I chatted with Darcie on my realization that the amount I contributed to my Roth IRA last month would’ve bought me a NICE pair of shoes, which was a little sad. Her response: “Just think of that you could buy with the dividends from that shoe money someday. Your future self will be proud!” Now, that’s my kind of financial talk.

If you’re interested in the GFW, she’s opens up the group every few months, and you’ll hear me talk lots more about it. I think everyone should take this course, but especially women who are getting started and want to build their financial futures from the ground up.

Resources for further learning

Note that the majority of financial education that exists out there leans toward an audience of older, white, male, cisgender, hetero, mid/upper-class. I’ve primarily included teachers here who do not fit that mold for diversity of thought and education. Enjoy!

There is so much goodness inside the financial world! Hope you enjoyed this deep dive. Let me know in the comments below who your favorite financial teachers are and your favorite budgeting method, tool, or mindset!

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