Budgeting

Change your mind about budgeting, change your life

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That may seem like a bold statement, but I truly believe it. Everyone squirms when talking about budgeting. People tend to talk about budgets as if they were all about depriving yourself of fun. Really though, budgets are not the carb-free diet you are imagining.

While budgeting does typically mean spending less money in a few areas, it also means using that money on things that really matter. That’s why I like to refer to budgets as spending plans. Find out how changing your spending plan to reflect your values can reduce conflict in your relationships over money, help you to ignore your lizard-brain telling you to spend now, and enjoy your money more!!

Everyone has heard the statistics about how often people fight about money in their relationships. It’s true, money is often a source of conflict between couples. Disagreeing about money is not a major failing in a relationship. However, it is a chance for you to work together to reduce the conflict in your relationship around money.

I have three ideas for you to work on to increase the trust in your relationship and help you stop arguing over money: budget dates, a spending max and conscious spending. Finally, stick with me all the way to the end to get concrete steps on how to get started on creating your money road map.

Set Up Regular Money Check-Ins

Money dates are a great way to create a team mentality for you and your partner when it comes to money. When you are both feeling relaxed, sit down and create a joint spending plan. (Not sure how to create a spending plan? Click here for a quick overview.) Then twice a month, check in and see how your spending is tracking. Ideally, this spending plan needs to be created together, otherwise it may be perceived as one person attempting to control the other.

After you have created your spending plan, don’t just put it in a drawer and forget about it. Sticking to your new spending plan is easier if you run all of your expenses through one account, so it’s easy to check-in and see how you are doing. Half-way through the month, open up your online banking app, grab a pen and jot down the total amount you have spent so far that month. This should be quick, so no need to break it down by category.

(Hint: Make this check even easier by selecting just one or two accounts to use for all of your spending.)

How Is Your Spending Tracking?

Next, do a quick projection of the things you KNOW you will need to buy over the next two weeks or so. If you use online bill pay (which I highly recommend), your bank may make a projection of scheduled outgoing payments for you.  Also, include things like groceries, gas, recurring bills, etc. add the total of what you have spent so far to what you think you will spend over the next two weeks.

What you've spent so far + your projected spending = budget check-in

How are you looking? Are you on track? If not, look for ways to tighten up your spending, and keep that in mind the next time your friend asks you out for dinner or your kid wants you to buy them a new soccer jersey. Set yourself up for success - put your spending plan check-in reminder on your phone’s calendar with an alert to keep yourself on track. Go ahead, I’ll wait.

Does Your Money Reflect What's Important To You?

Not sure what your goals actually are or how to create a budget? No problem, start here - get out your phone and block off 30 minutes on the next three Sunday nights for your money dates. Spend the first date thinking about what your money situation is right now, and where you want to go. Do you want to get control of your spending? Build an emergency fund? Save more for college or retirement? The following Sunday, take a look at your spending over the last month or two. On the third Sunday, review your budget again to see if you forgot anything. Think about what changes you need to make to ensure you are on the right track. Finally, change your money dates to every other week as a way to check-in on your spending.

Want more help on how to create a spending plan? Learn how to easily create a spending plan.

Great! Now that you have your twice a month money date set up, let’s move on to my second tip.

Create A Circuit Breaker On Spending

A spending max. A spending max might sound a little foreign to most people, but if you want to create greater trust in your relationship around money, you need to try it. It’s simple really - you and your partner (or accountability partner if you aren’t in a committed relationship) choose a dollar amount you won’t exceed unless you check with your partner before committing. It could be $100, $300 or $500, depending on your financial situation, but both partners have to commit to the process. Now, you may be thinking - I work hard for my money and I can spend it when I want to! You are absolutely right. You do work hard for your money, and that’s why you want to stay on track.

While this may feel like ceding control, it’s really about trust, accountability and working together towards a shared vision of your future. Some partners find spending caps to be helpful, some don’t like it. If you are in a relationship with low financial trust or if one or both partners has a tendency to make impulse purchases then definitely give spending caps a try. A check-in such as this can save you from a lot of spur of the moment splurges. Try it for a couple of months. I think you are going to really like what it does for your personal balance sheet and financial trust in your relationship.

Conscious Spending

My third tip is to pause before you spend. Let’s talk about your lizard brain. Your lizard brain is telling you that spending more money is going to make you happy. Your lizard brain is, well, lizard-like and full of stupid advice, like #yolo. Spend some time thinking about where you are and where you want to go. What are the things you really want to do (or not do)?

It can be helpful to jot down a short list or cut out a picture of a meaningful goal (i.e. a picture of the beach if you are saving for a beach vacation) and keep it in your car. That way, before you head into the store, you will be reminded of your goal simply by sitting in your car as you drive to the store. Staying focused on your life choices can be hard, but it’s worth it.

OK, so here is a quick recap of what we just went through. Work with your partner to get control of your spending. Each partner has to take responsibility for their own spending. Create a spending plan (Click here for help on getting started) and commit to having an ongoing conversation about your spending plan. Try a spending plan for 3 months and then check-in with your partner (or yourself) and see how it’s going.  

Finally, be clear on why you are making these changes to your spending habits, and keep quick reminders out to help you stay focused as you change your spending patterns.  

Let me know how it works for you!

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