Happy Monday friends. Hopefully most of you in the states have today off. We just got back from Florida last night so I am playing MAJOR catch up today (nothing like coming home to hundreds of unread emails after only 3 days away). Anyhoo, I am really excited about today’s #JAKWellness12 check-in and challenge because it’s something I have quite frankly neglected to do. Today we are talking all about budgeting money. I’ve never really been great at budgeting money (except when we were saving to buy our house…need to get back on that bandwagon again). I sort of just live off of what I have, which at several points over the last 10 years has been almost nothing. That said, I want to get better about a) saving and b) not spending on unnecessary things. Now that we own a house it’s crucial for us to have an emergency fund (really everyone should have one regardless of your situation). But doing that can be challenging, and if you are living paycheck to paycheck can seem impossible. It’s not, they key is to be honest with yourself about your situation, and your spending. Last week we got some great advice from my financial advisor Kevin, about investing money and the benefits of paying off debt vs saving vs investing. This week I want to focus on creating a budget, sticking to it and creating an emergency savings fund.
Curious to hear how you did after reading last week’s post and if any of you either started investing, prepared to invest or increased your contributions?
This Week’s Challenge: Create a Budget, Make a Savings Goal
I know some of you have already created a budget for the year and if so, bravo. For those of you that have not, the challenge for this week is to create a budget for you (your household). When I say create a budget, I’m talking about pulling all of your expenses together in one place but also coming up with a daily, weekly or monthly spending number to stick to. And once you’ve done that, coming up with a savings goal. Most advice calls for you to have at least 3x your monthly expenses in savings. Yeah I don’t have that right now, so don’t feel bad if you don’t either. But I am creating very aggressive savings goals to get me to that number.
-If you have not already, create a spreadsheet to put ALL of your expenses into. This spreadsheet from Remi is helpful to get you started. Once you have all of your expenses together, look for ways to cut some spending (eating out, subscription services, impulse spending-guilty as charged).
-If spreadsheets aren’t your cup of tea, try an app or budgeting software. I am doing a 30-day trial of YNAB. I actually really like that it’s a desktop software (vs on your phone). They have great reviews and if you decide to purchase it’s only $6.99 a month. Other options include Mint and Daily Budget.
-Start saving. The easiest way is to create (if your bank does this) an automatic transfer from your checking account to your savings account every month. To make it easier, create the transfer on payday so you are forced to live off whatever is left in your account.
-Another good option is to open a CD (certificate of deposit). This is a great way to save (and earn interest on your money) if you don’t need access to those funds for a certain period of time. This article spells it out really well and provides some really good suggestions for the best CDs available. I’m opening one with Ally (their rates are very competitive).
Good luck! Can’t wait to hear about your progress from last week. xx