Most people have a small (or, well, maybe not so small) panic attack when they feel the constrains of a (shh, don't say it!) ...budget... creeping its way into their lives. You know what I'm talking about. It's when you come back from the, well we'll just say weekend for now, sign into your bank account, and then gasp! You hold your breath, widen your eyes, and shake your head for a moment before needing to drop your head way below your knees and start breathing in and out of a paper bag for a few (or maybe more) minutes.
Yes, that dreaded moment of: putting yourself on a budget because money's become tight.
No fear! Aside from the fact that we need to take a hard, solid, and immediate look at how and where you're spending your money, the good thing is it's often fixable! Woot! Celebrate! (but maybe only by having a personal little dance party. You can buy youreself....well....nothing)
#1: Take a DEEP BREATH. You're going to be okay!
#2: Before you cut yourself off from society completely (although we may need to momentarily), look at how much you're putting into savings. Yes, I said it: SAVINGS. Don't have a savings? What's wrong with you?! No. Just kidding. But really. That's first, because that leads into #3. But first, #2. What percentage of your income do you put into savings every month? 5%? 10%? And what about retirement? You should always have something in both categories: retirement and savings if-I-need-to-touch-it-now money. Conservatively, make sure you're doing 5-10% Agressively, more like 15-30% (but this doesn't meant tell your financial adviser he's wrong because I said otherwise. Trust people who have the degree or experience first!) Personally, I put 10% in retirement and 20% in savings from each paycheck. Then, on to #3
#3: Assess how long you could survive on your RIGHT NOW savings if you needed to. Then look at how much it would take FROM that account to correct your budget if you did it all at once. Maybe it's $150, maybe it's $3000. But you need to be honest. How far "down" are you from where you expected or needed to be.
#4: What can I cut RIGHT NOW. Look at where you spend your money weekly! I saw weekly and not daily, because, let's face it, some of us get our coffee to go every day, and some of us splurge for that second or forth day, but it's not a standard. Start there. Cut the "extras" back. One less glass of wine or beer at dinner or that week, one less cup of coffee, condense your errand running so you do it on one day and not over three, and see where that will put your spending for the next paycheck cycle.
#5: Still haven't made all the money back through those cuts? Go straight college style again! Invite a friend or couple over for dinner instead of meeting at a restaurant. Same with a girlfriend for coffee. Have her over to chat instead of at the local percolating corner store. Plan your meals for the week and PRE COOK so you have it all divided out. Then if you're still hungry you'll notice what you can spare and maybe what you were just wishing to mindlessly eat.
#6: Think long term. What can I continue doing for another paycheck cycle to help boost me past the "danger" zone again. This way you'll have more of a cushion and less of a panic!
And remember, you work hard for your money. Yes, it comes and goes, but remember to stay savvy, and don't worry about what people will think because you didn't have that cup of coffee or second glass of wine with them. They don't pay your bills. You do. And they don't suffer your panic attacks for your. You do. And you deserve to not have those moments ever....or at least as often as maybe you have been having them.
And if you still feel like you can't get them under control, try MINT: the app on your phone. It will help you keep track after every expense so you can see and up to the minute delineation of your (yes I'm saying it!) budget.
Happy saving!
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