I love talking about money. Not in a greedy way but in a cool “what can we learn from each other” way — to make sure we’re playing smarter not harder. Why? Because my end goal is to enjoy financial freedom so I can spend more time with my family and spend less time spinning my wheels. I have a budget tip to share and Massachusetts Mutual Life Insurance Company (our sponsor) is helping to equip us with some pretty cool tools as well!
Today I’m going to share with you how we budget, in case some part of our system can be incorporated to help you too. And then I hope you’ll leave a comment with your best money tip! Talking and sharing is beneficial for everyone, we each have different strong points but together we’ll get all the pieces of the puzzle.
A Budget That Works
Becoming finically stable starts with a few simple steps — like creating short- and long-term goals and making a budget you can stick with.
We’ve been through a lot of different ways to budget before we finally found one that worked. The key for us was keeping it simple. Some people use envelopes but we use the good old fashioned write-it-down system.
#1. Create a goal
This will help you stay motivate and know what you are working towards. Add up your monthly expense, rent/mortgage, utilities, phones, gas, food, misc. spending. I like to err on the side of caution and always guess a little high that way I get excited when we save the difference. But you know yourself best, if you do better with a very riding tight budget (cause you’ll spend the extra $100 cushion) than plan you numbers tight. We then minus that from our total income. The remaining goes towards savings/investment and giving. WRITE DOWN YOUR GOALS!
If you’re not sure how to figure out your financial goals you need to start there first, that way you know what you are saving towards. MassMutual has some great resource for learning and identifying your goals. Is your goal a house? College for the kids? Retirement? Something else? Once you have your goals you will be able to take steps to achieve them!
#2. Next, record EVERY SINGLE expense.
Once a week use your online bank & credit card transaction summary to write each and every expense down on a line sheet of paper. (Or if you pay in cash save your receipts in an envelope and go through your expenses that way.) There’s a huge power in having to hand write every expense you made. Suddenly you’ll catch yourself wondering if you really need that new shirt you bough or realizing you had no idea you went out to coffee that many times this week. It’s amazing how much we spend without realizing. A dollar here, $20 there, and so on until we nickel and dime ourselves into the negative each month.
If you are a little OCD you can break it down by category so you know how much is spent on gas, groceries, eating out, entertainment, etc. I like to leave a few lines at the top with the monty expense: rent, utilities, phones, insurance and pencil in rough estimates that way I know roughly how much is left for food, gas, and misc. However you categorize it just make sure you are handwriting it and adding up each week.
#3 Add it up week by week so you don’t overspend.
At the end of the each week make sure you are still on track to not overspend. If you’re getting close, plan a few meals with beans and rice! {You can also check out this post for more money saving tips.}
So what happens if you overspend? You have to put a giant X over your savings goal. Take the money to pay for your overspending and write a new total next to it. Something about seeing it and writing it has helped us to consistently stay on budget. I hate crossing out our savings goal and having to change it to something smaller at the end of the month — I know it sounds almost too simple but this has seriously helped us to not spend. Seeing where your money goes has a huge impact, try it and see!
Did you know this month is Financial Literacy Month? MassMutual has created awesome resources (financial tools, calculators, helpful videos and insightful articles) to help all of us understand our finances a little bit more, so we can take steps to the finically future’s we want!
Here’s a quick 6-step list to make sure you’re on the right path:
- Create Goals.
- Get organized — find a budget that works for you.
- Use tools to help you project your savings needs — here’s one for college savings plans and another for retirement.
- Consider your most valuable asset and how it affects your future.
- Teach your kids early –so they will already be on the right path when the time comes. If someone has never managed dollars how will they ever manage hundreds and thousands of dollars well?
- Find the right people to help you — financial professionals are just that professionals. It pays to talk to people who know what they are talking about.
What are some of your family’s goals? Do you have a money tip that’s worked wonders for you?
This is a sponsored post written by me on behalf of MassMutual.
P.S. Are you looking for extra side income? I make full-time income blogging part-time—check out this easy step-by-step tutorial on how start a blog (no tech knowledge required).
Download My Free Family Organizer
Ready to de-stress + spend more time with your kids?
Life gets busy. I hear you. I'm here to show you how to CREATE more time for what matters most. Get a free family organizer as a thank you for joining our newsletter – includes monthly calendars, chore charts, meal planners and more...
Leave a Reply