This article is written by Berna Anat, a writer, a video producer, a youth advocate, She’s the voice behind Felicia’s Wallet on YouTube and you can check out more of her opinions on money habits here.
If I had a dollar for every time I heard, “I’ve tried to budget before, but…”?
Welp. I would’ve paid off my $50k debt a hell of a lot sooner, let me tell you.
But before I tell you anything else: Hi! I’m Berna.
Last year, I paid off $50,000 in student loans and credit card bills, quit my job, bought a one-way ticket to New Zealand, and now I travel full-time and make stuff on the Internet to teach people about money.
Now, that doesn’t mean that I sailed gracefully into Budgettown and got all the debt-slaying right on my first try.
My first budgeting attempts were such fails, and for so many reasons.
And now that I’m a personal finance coach, I see people repeat those same fail-reasons over and over, and I just want to collect everyone in my bosom and go, “Sshhh. Do better than me, child. EVOLVE.”
Good money habits are hard to start, but that doesn’t mean they’re impossible.
From what I’ve seen out on the battlefield, here are the top 3 reasons budgets fail – and how to fix them.
[click_to_tweet tweet=”Good money habits are hard to start, but that doesn’t mean they’re impossible.” quote=”Good money habits are hard to start, but that doesn’t mean they’re impossible.”]
If I walk out of the door with my running shoes on but only vaguely tell myself I’m gonna “go for a little run” without committing to a time or mileage?
Nobody is surprised when I lose steam and stop 0.5 miles in for a McDonalds soft serve just to ~treat myself. And, yes, I’m telling a true story here.
The same principal applies for budgeting: If you just tell yourself, “I’m gonna budget!” without a specific goal, you’ll lose steam, too.
It is not because you are dumb – it’s because you are human, and you’ve already got better reasons to do other things.
So, ask yourself: Why are you budgeting? What goal are you trying to achieve?
Your goal should be ridiculously specific – giving a what, a why, and a when.
A meh money goal is, “I want to budget to put money in my savings.”
A great money goal is, “I want to budget so that I have $5,400.00 in my Emergency Savings account by February 1st, 2019.”
When you say it out loud, it should be so detailed, it might irritate people; it should feel like you’re giving an overblown Starbucks order. (We have to stop hating on the girl who takes 3 minutes rattling off her latte order; at least she knows what she wants, y’all.)
The more specific you are – and the more genuinely excited you are about the goal – the more likely you’ll naturally stick to your budget.
[click_to_tweet tweet=”A meh money goal is, “I want to budget to put money in my savings.” A great money goal is, “I want to budget so that I have $5,400.00 in my Emergency Savings account by February 1st, 2019.”” quote=”A meh money goal is, “I want to budget to put money in my savings.” A great money goal is, “I want to budget so that I have $5,400.00 in my Emergency Savings account by February 1st, 2019.””]
True or false: It is much easier to recycle if you already keep separate recycling bins.
No one likes to spend their time dumpster diving for Number 2 Plastics, do they? (If you do, forgive me, and go on with your bad self.)
That’s what I tell my clients who keep all their money in one checking account.
If your idea of budgeting is sifting through one giant money pile to pay ten different bills, of course, budgeting sucks.
You’ve added the job of “trash sorter” to your life, and that’s no way to build a sticky habit.
Opening more than one bank account takes a huge step out of the budgeting process – you no longer have to do mathematical Tetris every month.
I suggest having at least 3 accounts:
This way, budgeting no longer means rummaging through your money pile like an accountant raccoon.
It simply means: Transfer enough money into each of these three baskets and sashay away.
If your “time to do my budget stuff” feels a lot like getting in a time machine and sitting down for the SATs? Needs. To. Change.
First of all, if you’re not a natural budgeting beaver, you need to dedicate a recurring slot in your calendar – at least 45 minutes – to look at your money situation every one or two weeks.
It’s like a money meeting with yourself. Easy enough, right?
Here’s what people forget: Unlike most work meetings, this one does not have to be boring and terrible!
Set this money meeting up like the most luxurious, decadent, self-indulgent meeting you have all week. A money self-care hour, if you will.
Wear your favorite piece of clothing. Make a playlist of your favorite, most motivating music. Light candles, set up snacks, do a quick yoga sequence at the beginning, and tell everyone to leave you the hell alone for an hour – this moment is for you and your money only.
[click_to_tweet tweet=”Starting a new habit is hard, especially when it’s with something so sensitive and personal as money. ” quote=”Starting a new habit is hard, especially when it’s with something so sensitive and personal as money. “]
It sounds ridiculous, but once I started doing this, I actually looked forward to budgeting every week. It was my bills-paying time, sure, but because I also associated that time with my ginger lily candles, my Hamilton soundtrack, and unlimited seaweed chips? Boom. I protected and anticipated this time like when I was 14 and the MTV VMAs were on. (Aw, remember when?)
A bonus rule, to wrap it all up: Be nice to yourself.
Starting a new habit is hard, especially when it’s with something so sensitive and personal as money. You can tailor your budgeting habits to whatever works for your amazing, capable brain.
Eff the rules, eff the Excel sheets. You’re in control, boo.
[click_to_tweet tweet=”Eff the rules, eff the Excel sheets. You’re in control, boo. ” quote=”Eff the rules, eff the Excel sheets. You’re in control, boo.”]
What’s the best budgeting advice anyone has ever given you?