In the spirit of one of my 2019 resolutions, living more affordably, I wanted to talk about my experience and struggles with budgeting this past year. Thankfully, I’ve found a method or more-so app, that has been really instrumental in helping me with my budget.
When I moved out of my parents house I knew I needed to budget. However, what I was a little naive about how hard it would actually be to get money into my savings account with the additional expenses I was now incurring. Quick shout out to my parents for being amazing and allowing me to live at home, cost free, for two years! You all are the real MVP’s as the kids today say. Anyways, I thought I had a good enough handle on my finances that I could mentally do it by continually checking my accounts. HA! Don’t worry I’m laughing at myself with you. Don’t get me wrong, it’s good to always check your accounts and make sure transactions are accurate. But, for me, using it as my method of budgeting wasn’t cutting it.
After a couple months of trying to “keep track in my head” and failing miserably, I knew I needed assistance. I had heard about an app through friends called Mint. Mint was helpful, I mostly just focused on the monthly income and monthly outcome and nothing else. My struggle with Mint was the transactions wouldn’t hit the app until it hit my credit card a couple of days after the purchase. In my mind, I would track the expense as soon as I swipe the card. This is just how I do it/think, I know others that do it differently, you have to figure out what works best for you. Compared to the app that I currently use, the user-friendliness of Mint wasn’t as good.
I said, “Adios Mint,” and tried my next method of budgeting; Excel. I need to pause for a second and give major, major kudos to my boyfriend, Matt. He is quite the disciplinarian when it comes to finances and he was a HUGE help to me in trying to figure out how I needed to budget. This man, God bless him, has been so patient with me and sat through many hours of me crying because it’s been so tight and my current methods weren’t working. Before, I would use the money I got paid each month for that current month. Matt got me to a point where I now use my paychecks from the previous month towards the next month so I’m always one month ahead. It took a lot for me to get there and understand this. I get paid biweekly which was causing the majority of the issues I was having when trying to live off the paychecks during the current months; I struggled not getting all the money up front. The other major no, no I was doing that Matt helped me realize was I had all my paychecks going to my savings account and then I would move what I needed to my checking account. If you’re doing this, stop. Don’t do what I was doing. You should only move money to your savings account, not out. Unless, of course, you are making a purchase that you were saving for.
The way I set up my Excel sheet each month was I had a column of line items with the budgeted amount I could spend each month and then a column with the exact same line items with the amounts I would spend. Within the columns I would organize the items by Fixed Expenses (rent, utilities, car payment, etc.), General Expenses (gas, groceries, going out money, etc.), and Savings (emergency, car issues, travel, etc.).I also had a column for Additional Income/Reimbursements that I used for Venmo’s for utilities, Ubers, etc., from friends. I only used and still use my credit card for a checks and balance purpose of making sure the amounts on my Excel matched my credit card statement. Any time I swiped my card I would go and add it to the appropriate line item on my budget sheet. Where it became tedious was I wasn’t tracking where I would “leave off” when I added in an expense from my credit card so I was constantly having to go to my credit card statement, try and figure out how I got the number on my Excel to see where I left off and then add from there. I tried to have a column where I would add in where exactly each expense was coming from and how much to avoid the back and forth but I felt like I was already living in a spreadsheet and now even more. When it feels like a daunting task, my motivation goes down. Lucky for me, and thanks to Matt, we found a solution!
Dave Ramsey is known for his books, podcasts and tools when it comes to budgeting and finance. I will admit, I haven’t read his books, but do plan on doing so! However, my solution to my budgeting headaches was solved through one of his tools, an app called EveryDollar. This tool allows you to budget out each month and then quickly add in your itemized expenses to specific budget items! For example, one of my budget items is Restaurants which I’ve budgeted $100 for. The other day I went to Cava for lunch (I also had a $8 credit) so I added into my app $2.89 (the amount after the credit was applied) to the Restaurants budget item on my app. Tracking done for you! It’s also nice because anytime I get a Venmo reimbursement I’m able to add that as an “income” to a specific budget item. The app is super user friendly and after more than a year, and thanks to Matt and EveryDollar, this month as long as I continue to stick to it, I will FINALLY be able to move a little bit of money to savings. Not much but, it’s better than nothing!
In addition to EveryDollar, another thing that I did that’s been a huge blessing in my financial life was opening a savings account with Capital One. They have a 360 Money Market Savings Account that when you keep between $0-$10,000 you receive 0.85 APY which is more than what you get at Navy Federal which I thought was good at 0.8 APY. If you have $10,000< you get 2.00 APY compared to Navy Federal’s which is .85 APY. This is easy money people and I encourage you to check it out!
I know for some, maybe most, a lot of this is not rocket science, and it’s me being ignorant. But, I’m hoping that for some of you that are like me and struggle in this field that you find some of the tools I mention helpful. Just know it took me a lot of trial and error to find something that worked for me. It also has taken a lot of patience, frustration and many months in the red to finally get to a place where I’m excited about my budget. Whether it’s a spreadsheet or budget app, find what works for you!
Ross once said, “I never think of money as an issue.” To which Rachel replied, “That’s because you have it.” Here’s to hoping one day I (and you) won’t have to think of money as an issue!