Managing My Money So It Doesn’t Manage Me

I am happy that my father is a budgeter. I started budgeting from my very first pay cheque and did not even realise what I was doing. Budgeting my money is something that is ingrained and this allows me to live debt free. My father is a great influence and I am grateful for how he showed me this in practice. Without this habit I would still be paying student loan debts and a bunch of others I am sure. Money matters and knowing how to handle your money well is paramount.

Budgeting, money, debt free

Get in the Right Mindset to Start Budgeting

I like to see where all my money is going before and after each pay cheque. I do not wait until pay day to write out my budget. As a matter of fact I have a draft monthly budget for the whole year. I manage my money and have conditioned my mind to spend money based on my budget. Some things stay the same from month to month or certain bills/taxes need to be paid at different juncture in the year. The money for these things do not belong to me, so I live in this mindset and devise how to set aside money for these bit by bit.

Humans are visual for the most part so writing things down is the way to go. There are also many apps and the like that help with budgeting. I am a pen and paper budgeter or I use a WORD document for my tentative monthly budgets over a year. Budgeting well means making a realistic budget.I do not do a barebones budget because that is a sure way to go over and blow the whole thing. I have two categories to cater to unexpected things that crop up in a month. The miscellaneous category caters to food items that I may want or need to buy but forgot to budget for. The additional expenses category is for anything else that crops up. There are months when I do not touch these or use up all the allotted funds and can roll them over. It works well for me. I recently need a Carbon Dioxide monitor in my apartment and was able to go into one of these funds to cover it. This means I did not have to dip into my savings.

It is important to envision how living on a budget will help you to have less headache in finding money to pay for the unexpected. It may be hard to boost yourself to start but once you do it for a few months it becomes addictive. Manage your money so it doesn’t manage you and cause undue stress and such.

Budgeting for Short Term, Medium Term and Long Term Goals

I budget because it is a habit and it helps me to have funds to enjoy travel and see the places I dream of. This is a major goal for me in this season of life. I am able to save, travel well and pay my bills, thus living debt free.

I use different bank accounts and envelopes to save up for different goals. It’s like money sprouts wings if you don’t monitor it carefully and have a plan to use it well. For example, there is a massive tax that I have to pay at the end of June every year. It is about 10% of my net income for the year. I budget a set amount for this every month and keep it in a separate account from the one I use for monthly bills and expenses. It gives me great peace of mind to have the money ready to hand over when the invoice comes. It truly is a great feeling I tell you.

For short term goals I budget cash and keep it on hand. I am saving up to replace my computer once it gives out life – this one has been carrying on for 10 years so far. When this happens I will be able to go and replace it immediately because I have been saving some money each month for a year or so for this.

This I also do for certain short trips, like visiting a friend in north Japan for the long weekend in September. I have a variety of envelopes for different short and medium term goals. It’s a great way to recycle the ones I get with my electricity bills.

I have certain long term goals that I want to achieve over the next two years or more. I have been saving for retirement for a while and have that in a low risk investment account. I add to it in lump sum over the year. There are other things that I am anticipating in the next 2 years or so and I budget some money each month in an account for these. I also make a note of what amount of money is in that account and the different goals it is meant for. Managing my money through budgeting is like a hobby for me actually and I keep an eye on my budget throughout the month and reconcile it at least once a week.

I find budgeting effectively for short term, medium term and long term goals is about being patient and setting realistic times frames, to meet said goals. Some things shouldn’t be rushed based on the amount of income coming in. I find it much less frustrating to save over longer periods of time than creating angst over getting something done sooner. I am intentional about creating a stress free lifestyle where possible.

budgeting, money, debt free

Staying the Course When Budgeting Becomes a Chore

There are times when a budget may feel too restrictive and just looking at all the money going out, with only a small sum for yourself, just makes you feel down. I remember the days when paying down my student loans in earnest gave me this feeling. I pushed through and used the fact that when I paid it off I would have more money for myself, to motivate me. I also did some teaching in the evenings to generate more income and treated myself a bit from that each month too.

The Debt Snowball method is a good way to prioritise debt payoffs. Watching the many videos others share about their journeys to being debt free on YouTube will inspire anyone. It is important to understand the ‘why’ of budgeting personally to keep going. My ‘why’, well one of many, is the fact that I like to be prepared and have money set aside to fulfil my responsibility to others.

For some people, having an accountability partner may be the thing. We are not solitary people. Find a friend or relative who you trust to help motivate you on this journey. Budgeting has different stages. In the early stages it is about forming the habit of budgeting and developing the discipline to stick to it. Then it is about budgeting effectively for different kinds of goals and rewarding yourself fairly. Another step is paying it forward by helping others to do the same and encouraging them.

Is budgeting for everyone? It ought to be. All major and minor companies have a yearly budget which they use to operate their businesses. Managing your funds is your business and doing so effectively requires a plan hence a budget.

A budget should be seen as a safe vehicle that allows you to maneuver you way through life and not as a cage that prevents you from spending wildly.

Budgeting Well Leads to a Debt Free Lifestyle

Who doesn’t want to be debt free? Having a mortgage is considered to be the one debt that one should be paying over the long term. Living a debt free lifestyle with the exception of a mortgage is ideal. Kudos to those who pay off their mortgages early.

I enjoy travelling and being able to so without amassing debt. I budget and save for my trips and give myself time to do this to go where I want to. This post shares a bit how I do this while working 9-5 as the average person does. I shop on a budget, give and do a host of other things based on budgeting for them. I am intentional about planning out where my money will go and I have so much joy from doing this.

I live in a cash based society and this helps a great deal. I also have a debit credit card which I have to top up in order to use. There is no going over my limit with this card and I like this a whole lot. When I travel, I give myself a budget, pencil it out and reconcile it daily. I also give myself a good miscellaneous portion to cover additional expenses that do come up on every trip.

As far as I can see there are no disadvantages to budgeting and making it a lifestyle practice. If you know any please share below.

These are my thoughts on managing my money so it doesn’t push me around. Let me know how and why you budget.

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  1. I actually sat down with my husband the other day to do this because after moving (we are in the process right now) and doing a whole host of other things, I really needed to see where all our funds were going to. It feels good to WRITE IT ALL OUT and see it as opposed to just logging on to accounts and what not on line. OLD FASHION paper and pen = YES PLEASE!

    1. Yes, I write it out and also keep a digital copy as well. I am happy you and your husband could have this important conversation.

  2. Wow, your system sounds very well thought-through. And it does seem like you really enjoy the process, like a game, where you collect points and then can use them. 🙂
    I used to budget a lot when I was studying, but recently I have been thinking about going back to it. It just feels better to have a good overview over how much money is going where.

  3. This is great! Staying the course can be a challenge but definitely pays off. I love to travel too so I sometimes have to make tough tradeoffs. The perfect shoes vs a plane ticket lol.

  4. We sound like kindred spirits. I’m definitely very frugal and conscious of how I’m spending and saving. The downside is I think it’s kept me from traveling because that seems like a frivolous expense sometimes.

  5. Great ways to budget your money, I will be using these tricks for myself thank you for sharing!

    ~xo Sheree

  6. I like the idea of having several accounts for different savings goals. I currently have a savings account that I named “Our New House.” It reminds me what I’m saving up for! 🙂

  7. Great Tips on managing our money. Loved the post it really helps us traveler not to excess what we have on our budget.

  8. I learned budgeting from a co-worker when I started working at a bank. It’s something I wished I had learned so much earlier but I am thankful that he took the time to help me then. Debt free living is where I want to be!! And this topic needs to happen sooner than later!

    1. High five to that coworker, I share with family and friends too because I really want them to live in financial freedom.

  9. This is great info! I’ve been hearing more and more about the debt snowball – really interesting! Thanks for sharing!

  10. We try our best to live within our means. If we can’t afford it, then we don’t need it. Simple as that. Our goal is to save enough for retirement. Now that the last child is almost done with college, we will be able to set aside more into our retirement fund.

    1. It sounds like everything is on track, I am happy for you guys. I too am saving for retirement because it’s never too early to do so.

  11. Being debt free is definitely become more difficult. With the amount of “wants” in a person life it sure does add up quickly. Budgeting is definitely key!

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