Lesson 5 – Make Budgeting a Habit

  • July 20, 2021
  • By: Greenpath Financial Wellness

In week 5 we are actually going back to repeat Step 3.  Why?  Because this is the most important habit you can create.  The single most important thing you can do to change your financial situation is to plan what you want your money to do.  So let’s do this!  

Step 1: Pull out your plan from week 3.  Take some time to evaluate and see how you did in Week 3.

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Step 2:  We have a new budget template for you to try.  If the other plan did not work, let’s try this one.  Download this budget template.  At the top write the dates you are paid and the income you will receive.  

Step 3:  List out every expense you need to pay this month.  List the expense and the due date under the income you will use to make the payment.  This is SMART budgeting, we are making the plan specific so it is easier to take action.   

Step 4: Add in your day-to-day spending (transportation, groceries, etc.)  

  • Set a grocery goal 
  • This is going to vary depending on your age, family size, where you shop, etc.  Groceries are often a blind spot.  We figure well this is something I have to have so I just buy what I need.  Or sometimes this is the aha of oh my gosh I had no idea I was spending so much.  A good rule of thumb for grocery spending is between $170-$340 for a single person.  As you begin to add in additional family members, it is not a one for one substitution.  You can check out the USDA recommendations here.  Just like our fixed monthly expenses, we want to allocate when we are going to the grocery store and how much we are going to spend.  Add it to your list.  
  • Add in non-grocery items 
  • Think ahead, will you need shampoo, conditioner, toothpaste, garbage bags?  If you purchase these items separately from groceries, set a budget for these items.  Alternately, you can set a goal for how much you want to spend at specific stores.  For me I stock up on these items at Costco and I have a spending plan for Costco and another for the grocery store.  
  • Account for transportation 
  • If you are leaving your house, you are likely going to need to pay for transportation expenses.  Maybe this is a fixed expense, your auto insurance or a subway pass.  For many of us it is an anticipated expense.  It is the cost of filling up your gas tank or paying for Uber or Lift.   Identify how much you will spend from each income source.  
  • Add in events 
  • Is there a birthday? A holiday? A social gathering?  Do you simply want pizza every Friday because danget it has been a hard week and I want to treat myself.  Make it part of your plan!  This way you can have pizza without the guilt of feeling as if you blew your budget.  

Step 5: Add in your savings and money to fund your future goals 

  • Savings  
    • I’m hoping as time goes on savings will become a fixed expense in your budget.  If it is not a fixed expense quite yet, let’s figure out how much you can save and where you will save it.  A great rule of thumb is to save 10% of your income into an emergency account.   
  • Money for Future Goals 
    • Identify the money you are going to put towards your goals.  How much are you saving for your home purchase, for your vacation or how much are you going to pay towards your debt?   

Next steps:  

Schedule time to talk with your coach. Your coach will walk through YOUR specific plan AND will help you be accountable to following through!  Our coaching clients say the most important thing you can do is meet with your coach to go over your plan.  Check out this testimonial:

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We are going to repeat this step every month!  Why?  Because every month your financial situation is going to change and we want YOU to be in control of it!   

What if you got through this exercise and there isn’t enough money?  This can be an uncomfortable feeling or sometimes you know.  One of the people on our coaching team found herself in this same situation after going through a breakup.  There simply was not enough money for all of the bills she had accrued.  She felt ashamed and even worse; she did not feel like she could show up authentically for people like you.  How could she give advice when she could not figure it out?  Guess what? She did figure it out!  Check out the FaceBook group for her ideas on how to earn more, spend less and feel better.   

P.S. The girl who did not have enough money, that was me!  You can read my story here.   

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