Budgets


Back in September we moved from Hamilton, ON to Montreal QC. We chose Montreal because we both loved the city every time we had visited, plus I have family here and there are tons of opportunities for Nick in terms of work, it seemed like the perfect time to make the move.

But the adjustment has been harder than expected. We have a bit of debt, and while the cost of living is less in Montreal, so are the wages. For the first time we are really having to live on a budget and stick to it. I recognize we are very fortunate to be living here and living on a budget is a pretty normal thing but it can also be pretty hard and seems to be something a lot of people struggle with. My friends often ask me how we live on a budget and how we stick to it, so this will be the first part in a series of posts about living on a budget, budgeting for travel and budgeting for a wedding.

The first thing I do when starting a budget is look at my income, and my partners income. He is a chef, and I am a bartender, so while we know how much we are bringing in hourly, we don't know how much we will make in tips, so I estimate. I always low ball my estimations because if I make more then its a bonus, if I make less, then I know I really need to hustle more. I like to do this by creating a chart that includes all the money coming in and all the money going out.

 Our "INCOMING MONEY" chart looks like this:


You can see that on weeks where we made more than estimated that I highlighted it in green, on weeks we didn't meet our target, I highlighted it in red. I have a running total of what I expect we will bring in before Christmas, so it will be interesting to see if we manage to accomplish that.

OUT GOING MONEY


Again, I have used green and red for when we have gone under/over budget and I have a running total at the bottom of how much we should spend vs how much we will actually spend. These are just a few things on my chart, my actual char includes money spent on groceries, metro passes etc etc but it would be too big to include everything in this post. If you're making your own chart just think about your day to day expenses and then don't forget to include any special occasions (birthdays, anniversaries, etc).

Another tip for budgeting is to create a financial goal within a time frame- but remember you can adjust your time frame, it does not have to be set in stone. My current budget runs from Oct 1-Dec 23 (our last day of work before the holidays), but in the new year, I will probably return to a month by month budget. You can have any time frame you want, maybe you're saving up for something particular, or maybe just seeing how much you can save in a year. Just remember, you don't have to feel bad if you have to make adjustments, unexpected costs come up, or if you're like me, and part of your income is from tips you're going to have busier weeks and slower weeks.

It's also important to know how much you are comfortable spending that is outside your budget. For example, our really good friend and his wife came to Montreal and we went out on a Saturday night with them. We had lived in Montreal for 2 months and hadn't managed a Saturday night out. So we took them to two really cool bars and enjoyed our first Saturday night in our new city. Did we spend more than we planned? Yes. Do we regret it? No. If you are going over your budget, or attending an event that you didn't budget for the key is to know how much you're comfortable spending and if there is a way to make up the difference. We went out on a Saturday night and had a great time with friends we hadn't see in a few months. It just means that for the next few weeks, we won't do a date night, instead we will stay home and cook dinner instead of going out. It can be really hard restricting your social life. The best advice I can give is pick and chose which opportunities matter most and which will enrich your life.

Sometimes it's not necessarily experiences or social life that can be a challenge to a budget but maybe a really good deal at your favourite store. Or maybe you've had a crappy week and wanted some retail therapy. For example, Sephora had a sale on for two makeup palettes I wanted. And we are talking like crazy sale, 50% off, making a 60$ palette 30$. I was so tempted to buy it, especially because it is only 30$, what's 30$ in the grand scheme? But those "small" purchases add up. Instead of buying it, I pulled out all 'my old makeup that I never wear, and played with the palettes and the colours and realized that, oh yeah, I already have a bunch of pretty makeup and I NEVER wear it. SO should I really be buying more? Same goes with clothes - right now, H&M has about 500$ worth of stuff I would buy (I know because for fun/torture I added it all to my cart to see how much it added up to). Again, instead of giving in, I thought, what could I do alternatively with 500$? I mean right now there are flight deals round trip to London, England for 340$, so I could ALMOST buy both my fiance and I airfare. I mean thats just ONE thing I could do with 500$. I could also, you know, pay off my credit card. And while I still really want to go to H&M and buy some new clothes, I always tell myself that there will be another sweater I want, or there will be another restaurant with an amazing menu. Shopping or eating out or getting a tattoo (can you tell by my examples that those are the three things I need to cut back on!) will always be there, so by saving money now, you can spend it later.

At the end of the day, you have to find a system that works for you. Some people always put 10% of their pay checks into savings, others save in bigger junks and less frequently. You also have to get use to saying no to yourself, which is probably the biggest challenge. If you're creating a budget for the first time, the best advice I can give, is keep track of everything, everything you bring in and everything you spend so that you get a better idea of what you're actually spending your money on!


This photo was taken on Diani Beach in Kenya. This was part of our first big trip as a couple, we spent 6 months aggressively saving for it.

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