As a Financial Coach I am often asked my thoughts on people’s personal finances. People are often looking for the fastest and easiest way to change their financial future. While I have many tips and tricks, most of them are not fast and easy. As Dave Ramsey says, “you can wander into debt, but you can’t wander out”. Changing your financial future is worth it, but it does take time and a commitment to change.
Over the next few posts, I will share my thoughts on money in different areas that will change your financial future.
#1: If you’re married, consistently talk with your spouse about money. This is a game changer, especially if you’re not used not used to doing this.
#2: Be patient. Getting out of debt is not an immediate thing, it takes time. During this time you will be learning new spending habits that will keep you out of debt in the future.
#3: It takes about 3 months to get a budget right. After 12 years of doing monthly budgets, we still change our budget every month. But after 3-4 months you will have a good blueprint for your budget and it does get easier. Don’t quit too soon.
#4: Your budget will succeed or fail based upon your spending behavior. A budget does not force you to stay on track. If you don’t change your spending behavior, your budget is useless. For a budget to succeed you must make changes to your spending.
#5: You must track your transactions. In order for your budget to work, you must track your transactions during the month. Download an app to make this easier. But if you don’t track then your budget is just a theory.
#6: You can (and should) budget on an irregular income. Base your budget on the lowest estimate of what you make. If you make more in a month, you can adjust your budget to reflect the extra income.
#7: When times are good, put money aside for leaner months. When on an irregular income, create a hills and valleys account to help maintain your budget.
If you are having a hard time creating a monthly budget, let’s meet!