Personal finance is a very touchy and uncomfortable topic for families these days, especially with the rising cost of living and external factors that we have no control over. What we do have control over is our lifestyle habits and our financial future if only we would take time to carefully plan it. Businesses and people alike fail financially because of inadequate planning, the scripture alludes to counting the cost before making decisions to build.
As families when we fail financially it place additional stress on relationships which then adds to deterioration in our emotional and mental state. We have so many insecurities especially when we think of the future, my challenge is to not let finance be one of them.
According to Statistic Canada, there are more than 3.2 million Canadian living below the Canadian official poverty line. Now living below the poverty line is by no means a the dream of anyone, however, life happens sometimes. The hope is that this article will give us the little push we need to start learning more about our money to eliminate some fears that lingers over our financial future.
Everyone has an idea as to how they want to retire and all the nice things in life that they want before we move to our golden years , rightly, there is nothing wrong in desiring what is good.. However as we would have heard over and over ” good things do happen”but not without perseverance and self discipline. The remainder of this blurb is focused on channeling our perseverance and self-discipline in to making us live that life of accomplishment that we so much desire.
Is it impossible ? Hell no! Would it sting a bit ? Just a wee bit , I promise.
The Plan
It is easy , a budget is a financial plan for a fix period of time, whether it is weekly, monthly or yearly. Basically, lining up your income and your expenses and find ways to curtail the variable expenses so that we can have more money in our pockets. Now creating this plan is the easy part, the execution is what many of us find really hard to do.
For any financial plan to be successful there must be a willingness to make lifestyle changes. Once we learn how money works saving ways become very familiar. Here is a format we started using in our family couple years ago. Outside of this we would see extra money and of course we find use for it and before you know it many unhealthy spending habits are birthed and nurtured at the expense of our happily ever after fund.
If you are serious about a brighter future, here is how to start planning your financial future.
Create a spreadsheet with all your fixed and variable expense
List all of your variable expenses
We stick to it… This is the hardest part but you got this.
All you need is a basic spreadsheet, nothing fancy. Below is an example of what your spreadsheet should look like.
Expenses
Week 1
Week 2
Week 3
Week 4
Mortgage
$ –
$ –
$ –
$ 1,500.00
Property Tax
$ –
$ –
$ –
$ 300.00
Savings
$ –
$ 400.00
$ –
$ 400.00
Grocery
$ 200.00
$ 200.00
$ 200.00
$ 200.00
Gas
$ 100.00
$ 100.00
$ 100.00
$ 100.00
Utilities
$ –
$ –
$ –
$ 450.00
Debt Repayment
$ –
$ –
$ –
$ 120.00
Home Reno/Repairs
$ –
$ 150.00
$ –
$ 150.00
Vacation Fund
$ 100.00
$ 100.00
$ 100.00
$ 100.00
Entertainment
$ –
$ 150.00
$ –
$ 150.00
Miscellaneous
$ 150.00
$ 150.00
One of the way to deter unnecessary expenses is to classify it. Think about the item that you are thinking about purchasing and see which expense category it falls under if it does not qualify under any of your expense category from your financial plan for the month then forget about it.
I have a similar plan as the template above, one of the good things about this is that unused amounts are transferred to Savings.
Sticking to a financial plan is a patience game, it takes a lot of commitment, but the result will be you keeping more of your money. Why not make a plan and challenge yourself to save a few hundred dollars next month.
Be sure to click the image to get your FREE Bill checklist, Monthly budget sheet and Saving Planner.
Today’s topic will help declutter the debt that has been weighing you down. Debt has a way of straining relationships, draining your health and stealing the peace around you. It doesn’t matter what kind of debt you might have, it all comes down to owing money. Take these steps and make a change today. Your future self will thank you.
HERE ARE 5 PRACTICAL TIPS FOR PAYING OFF DEBT FASTER THAN YOU THINK POSSIBLE.
1. FACING THE TRUTH
Saying you want to get out of debt is one thing but before you can start, you need to fact the truth and understand how much you really owe and to who. Get a sheet of paper or open excel and write it all. Once you see and read it, it is as real as it gets. A lot of time people tend to ignore their monthly statements just so that they don’t have to face the truth. It is a harsh reality but if you are serious about getting out of debt, this is the first step.
2. TRACKING YOUR EXPENSE
Everyone needs a budget and I mean EVERYONE. Feel free to use my FREE printables that will you manage and visualize your goals better. I don’t understand why people feel that budgeting is a bad thing and that it is limiting and controlling. For me, a budget is freeing instead of restrictive and it keeps me on track. I don’t have to be in denial. Every month my husband and I have a budget meeting, it’s a way of keeping us on track with our financial goals because not every month will be the same.Life does happen and you need to have a plan. With a simple budget, you’ll be sure you are spending less than you earn and you’ll have a clear picture of where your money is going. Not only is budgeting important for keeping you with your goals, it is crucial to maximizing your debt repayment.
3. MAKING SACRIFICES
Making sacrifices ties in when you are going over your budget. You already know where you have to make cuts. Do I need to remind you of that gym membership that you haven’t used or the tv package that you know you don’t use. Try buying the generic brand instead of the big brands. Before you spend money, ask yourself if this is necessary or if it can wait a little bit. You need to think outside the box when coming up with ways to minimized your spending. Have you heard of the word “FRUGAL”? Guess what, being frugal is not a bad word. Being frugal will help you become debt free and that is the best feeling. Challenge yourself. Remember, we all need to make sacrifices in life, in order for you to get out of debt, you need to do your part. You are strong and you’ve got this!
4. EARNING MORE CASH
While saving is a good start, you increasing your income will make this work faster. When it comes to earning money, the sky is really the limit. Go ahead and google “passive income”. Put your creative thinking hat on and get cracking. The possibilities are endless especially in today’s online world. Do you have something that you can do or a service you can provide? If so, open an Etsy shop or get on a freelancer website like Fiver where you can get paid for your service. Do something. Do anything. Whatever extra money you can make will help you reach your goal faster and trust me, once you get in the rhythm, things will flow so much better. Just please don’t fall into the trap of seeing extra money as a way of spending more. All the extra cash goes straight to your debt.
5. STAY ON COURSE
No one says that this will be painless. You will feel the itch but stay on course. It will all be worth it. Paying off debt takes longer than getting into debt. Celebrate every bit of success and most of all, try talking to your partner or friend so that they can cheer you on. Keep your eyes on the prize and that prize will set you free. Never doubt yourself. Your goal is within reach and you will be in a happier place in your life. Show the haters that you got this and that you will come out of it.
As 2020 is nearing the end, I got to thinking what is one thing that we all wish we could do more of? I want you to think about it for a second.
Yes, you said it! SAVE MORE MONEY ! Right?
Today I’m going to let you in our a little secret that I stumbled upon and thought if this can make such a big difference, imagine what else can we kick in the butt for the year 2021.
One simple method to reach your money goals faster.
There is a lot of misconception when it comes to building a rainy-day fund. The most common of excuses is that we don’t make enough money to save or that our bills are too much. This is mostly to dismiss the guilt surrounding this topic.
Saving is a patient and a long game; I believe we don’t have the patience to watch our savings accumulate and that is one of the reason why we fail to meet our goals. We either underestimate or does not envision the impact of putting a small bit away into savings every pay period. See our personal example later how there is always money waiting to be grabbed.
Years ago, we created a family model whereby we plan the next family vacation a year in advance, we then cost it out and decided we will put cash in a jar every pay period to cover our travel expenses. We then realized that this model can be adopted into our saving habits, so we plan as well how much we want to save for the year divided that number by our pay period and transfer that amount as a minimum into a savings account.
Here is how we found an extra $2,496 in the first year:
We each packed a lunch two days per week, this is on average $40
Make our coffee at home a couple days as well, this another $12
This $52 per week for the two of us for approx. 48 weeks. Your situation might be different from ours, maybe you are not a foodie, but certainly there might be a habit or two that you can tweak and find money that is going out the door.
It is called a rainy-day fund, throw the jabs while you are waiting for the knockout punch and preparing yourself for the rain.
I hope this one little example can ignite a fire within you and show you what you can do with your money. It’s not about how little you make or how much the monthly bills are but it’s always and i mean always the little habits that no one ever thinks about.
Hope you enjoy this and look out for more budget related tips and tricks.
