How to Budget Better and Stop Hating your Budget!

This may surprise some of you, but I have a love/hate relationship with budgeting.  And it’s been mostly hate over my lifetime, but I always wanted to know how to budget better.  I recognize how important it is, and when I’m going strong, it can almost be enjoyable.  But when you fall off the wagon – gosh, it is HARD to climb back on.  And prior to 2008, I NEVER EVER EVER budgeted. I had no idea how to budget.

Before I continue, let me clarify my use of the term ‘budget.’  I do not simply mean checking your account balances and making sure you have enough income to cover your expenses throughout the month.  I’m talking about a proactive management of your finances.  On a monthly basis, this usually means mapping out each dollar’s designation ahead of time.There are several excuses for those who don’t budget.

How to budget better:

Here are two fairly common reasons, and I’ve been in both of these camps:

• Your income doesn’t even cover your expenses, so why try?  You may be almost afraid to look at your checking account balance, let alone your credit card balances.  You already feel trapped, why further constrain yourself? You may wonder how to budget when you don’t make enough money.
• Your income is much more than is needed to cover your expenses, so it’s easier to skip budgeting.  You don’t want to be constrained. The problem is, one loss of a job and you don’t have a plan. Now you HAVE to budget!

I can only speak for myself, but in each of these cases, the overriding reason to not budget was a mixture of laziness and an unwillingness to restrict my spending. Those aren’t very good reasons.

In fact, is there ever a good reason?  How could I NOT know where my money was going?  I would never invest in a business being run this way, yet I’ve been willing to run MY OWN LIFE and risk my family’s financial future because… I DIDN’T FEEL LIKE IT?!?!  (I’m sorry for shouting… I just wish I could shout loud enough for 24 year-old self to hear.)

During the times in life of not budgeting, I always knew that at some point I’d have to face reality.  My rock-bottom arrived while living in Charlotte, NC several years ago as I faced the reality that I had been avoiding.

It took work… a lot of work.  I also took quite a bit of compromise, and restraint.  And after the first few months of budgeting, I realized 3 things:

1. Despite practicing some serious financial restraint, I felt like I was still spending SO much money!  If I felt like this now, I must have really been blowing through some serious cash (and credit) before I started my budget.  And what did I have to show for it?  Well, I did have some nice furniture… and some nice credit card balances to go along with it.
2. I did not feel like my quality of life had diminished at all.  An unexpected thing happened when I gave myself only $75 a week for food… WE DIDN’T DIE OF STARVATION.  And we also didn’t need to go to the local soup kitchen or get any assistance.  We made it work.
3. This was the most surprising one – by limiting ourselves, I actually had more freedom.  How could this be?

I want to take moment and discuss #3 for a bit.  A very succinct definition of maturity is the ability to delay gratification.  This isn’t just a cute, insightful definition created to make a point or impress people.  Delayed gratification is well-studied personality trait by psychologists that has been linked to greater mental and physical health, as well as overall achievement in life.

Described more simply, it is the ability to tell yourself ‘no’ because you know that the future holds something better in store for you.  A three-year old cannot do this very well, but an adult should be able to.

Through this budgeting process, I came to realize how immature I was in some areas of my life.  With things as small as wanting to go out to a nice dinner on a whim to things as large as wanting to buy a nicer car – I was unwilling to say ‘no’ far too often.  It’s not that these things are inherently bad, but I didn’t have the money for them!  And when I started telling myself ‘no,’ it didn’t feel like punishment, it felt like HOPE.  I had a plan; and I still have a plan.  I am saying ‘no’ because there is something better in store later.  With that hope comes freedom, and a feeling of control.

But as I mentioned earlier, I have not always been a model citizens when it comes to budgeting.  Life has often gotten crazy (it has a way of doing that, doesn’t it?), and during some of those times I relapsed and went a few months without a budget – and it SUCKED.

I felt completely out of control, and getting that control back was so hard… I would picture myself trying to wrestle a tornado.  I would start to lose hope, and feel constrained instead of the freedom I had gotten used to.

One more comment on this freedom – it isn’t just a feeling – it is actual, physical freedom that can be acted on.  Through years of discipline, I don’t owe anyone anything because I am debt free.

This freedom all started with a pen, some paper, a money saving budget planner, and a whole bunch of desperation.

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