Creating Your First Budget
So as you can see we brought in about 200$ more than we budgeted for, and we spent about 300$ that we didn't budget for. The things we spent money on were part necessity, part social, and one of the things on the list was for our upcoming wedding. Spending money on the wedding is going to pop up more within the next year and I probably won't know when to budget for it. All in all we are moving into the next two weeks with money set aside for our credit cards, as well as having everything for march paid already. We also have a mystery 200$ that I can't account for, it might be left over from before I started the budget. I was a little lazy in keeping track of everything we had before the budget started so Im not sure how to explain it.
Going into the next two weeks our budget looks like this:
I've left the tips at 350$ because I made this budget a few weeks ago, and we'll see what comes of it. Again, I haven't accounted for spending money, but in the past I've found it too exhausting and stressful, it can cause anxiety when you can only spend X amount of money on groceries or going out and seeing your friends. It took a long time for us to find the right balance of saving and having a social life, so for now, I'm just adding the money we spend into the budget after the fact, and I'll make adjustments week to week so that we stay on track for our savings goal.
So how do you start your first budget? It can seem a bit daunting and overwhelming but to start I recommend that you list everything you spend money on. Try keep a journal for a month, write down everything you spend so that you can get a better sense of where your money is going. If you want to get really in depth in your journal create some categories, rent, food, utilities (I would include phone bills and Netflix here) and spending money (going for coffee, going to dinner, shopping), really see how much you're spending and on what. Then going forward you can have a realistic expectation of how much money is going out. You'll also want to start keeping track of how much money is coming in. Maybe you work a "9-5" job so your pay check is pretty much the same every two weeks, maybe you're self employed, or maybe you're a waitress, keep track of how much you're bringing in vs going out.
Now make a goal, are you saving to see how much you can save? Big credit card bill? Dream vacation? Buying a house? A car? Give yourself a time frame to reach your goal and remember that a budget is just an estimation, you'll have some weeks when you'll meet it, and some when you won't. Do not beat yourself up or get stressed if you spend more than you thought one week.
It's also important to set your priorities for your spending. Some spending is essential such as groceries, rent, etc, but in order for you to be successful in saving you need to make some cuts to non-essential items. You have to decide what is a priority to YOU and make cut-backs accordingly. Don't think of these cuts as sacrifices because ultimately they are helping you attain your goals.
It will take a while to strike the perfect balance, in the past we have been too focused on saving and counting every dollar, and developing an anxiety over it. But the other end of the spectrum is that it can be too easy to #treatyoself. Self-care and treating yourself is really trendy right now, and if it is something that is important to you, then you need to adjust your budget and re-evaluate your priorities for your money. It is too easy to fall into a pattern of having a hard day or week and thinking "I'll just treat myself this one time, I deserve it." Whether it's a glass of wine, shopping, a night out, etc, if you're doing that too often, you won't see your savings go up. Setting both your intentions and priorities will help you achieve your goals. The one thing I won't sacrifice is my monthly yoga membership, I find that the benefits (both physical and mental) out-weigh the cost (79$/month for unlimited yoga). In order to still save money, I have cut back on shopping, manicures, going out for drinks, etc. It's important to find a way to live in the present while still saving for your future.
It can definitely seem exhausting but once you have a budget going and find your equilibrium it's something you don't think about too much. For us, its the only way we can do everything; live in a major city, travel multiple times a year, and have a big wedding.
Leave any questions in the comments below, and check out some of my travel photos on Instagram @thenomadicbee ! Soon I'll start sharing more about our wedding plans and budget. Plus some winter tips for how best to enjoy Montreal. It really is a great city if you're looking for a mini-vacation.