Nearly three months into the year and I’m really happy with how my budgeting is going.
Don’t get me wrong. It’s certainly not perfect, and I’m definitely not completely “living on last month’s income” as YNAB instructs. But I’m getting there.
The big difference? I’m planning for the future. I’ve prioritized setting aside money each month for my big annual bills, like property taxes and insurance bills. So even though I feel like I’m still spending too much (and I am), my account balances are growing in preparation for those upcoming bills. So I’m focusing on the positives and figuring out better ways to continue my planning ahead. It’s really a great feeling. Of course, when those big bills come and I have to make those large payments and see the account balances plummet again, it will be a sad moment, but one I’ve prepared for.
For me, a big change has been that I have to be very careful about my immediate spending. Instant gratification is awesome. And online shopping is easy. Sales sites are tempting. The little things do add up, and they add up quickly.
One thing I need to do that I haven’t been is to specifically set aside some fun money each month. Money that can be spent on whatever I want. If I decide I want to buy a song on iTunes or a clown punching bag for the office (it was a discussion this week), if the fun money is there, I can buy it. Oddly enough, I spend more time debating a purchase that’s under $5 than I do a $20 purchase. I need to figure that one out. I guess I’ve spent so much time worrying about the little things that I’ve stopped focusing on the big picture.
As the weather starts to get nicer (though we had snow flurries to celebrate the beginning of spring), I’m spending more time outside and realizing that I need to be putting some money into my house. There are a number of projects that have been on my list since I bought my house five years ago that I still haven’t gotten to. It’s well past time. Some of them are going to be a bit expensive, others are just going to take a bit of work on my part but hopefully not too much money. Either way, it’s time to start setting aside money for home improvements and get moving on it.
All in all, I’m really pleased with my budgeting. It’s far from perfect, but it’s a work in progress and it’s really going well. Budgeting is really about planning ahead and rolling with the punches.
How do you feel about your budget? Does it make you happy or does it fill you with dread? Do you feel like you’re making progress in your financial goals, whether that be saving for a specific purchase or paying off your debt? Whatever you do, don’t let the negative feelings creep in. Keep plugging away and keep working at it. Every dollar you save gets you one dollar closer to your goal.
Megan is a 30-something government employee in the Washington, DC area. She got interested in Personal Finance when she got out of college and realized that her paycheck wasn’t going to go as far as she had hoped. Since starting this blog, she has managed to buy a house and make a solid start on her retirement goals, and hopes to help others do the same. Here is her story:
In 2007, I was a gainfully employed 20-something with no debt but not a lot of knowledge about personal finance. It was a co-worker’s comment about Roth IRAs that sent me to the internet, searching for information. It was then that I realized that I really didn’t know a whole lot about personal finance and that my current financial situation was due a lot to inherent frugal tendencies, generous family members, a fear of debt, and good luck. While that was working for me, clearly I needed a better plan.
While I had no debt, I was also pretty much living paycheck to paycheck and not worrying about going over budget (I say this as if I had a real budget) because I had an emergency fund set aside to cover any overages.
Except that’s not what an emergency fund is for.
So I did a lot of research, read a lot of blogs, and decided that I needed a plan. I needed to budget. I needed to know what I was spending my money on. I needed to prepare for the future.
I decided to create a blog not only to make myself accountable to others but also to share the knowledge that I gained along the way. I’ve learned so much from my fellow bloggers, and I hope that my readers can find something useful in what I have to share as well.