Part of being faithful to God in our work involves being faithful to God with our resources. But for many of us, we feel at sea here–how do we better take care of our money and handle that dreaded B-word (budget)?
We’ve pulled in a couple of pieces of thoughtful advice on the topic from around the web. Today, some tips from a secular perspective that originally appeared in Money Talks News (we picked them up via the Christian Science Monitor) on “five ways to stop living paycheck to paycheck.” Tomorrow we’ll look at budgeting in an explicitly Christian context.
Writer Angela Cooley says:
I lived paycheck to paycheck for years, sometimes running out of cash days before my next payday. I spent too much and racked up debt. My entire financial safety net was the $50 minimum required to keep my savings account open.
My game-changing moment came when my paycheck bounced and the financial tightrope I was walking on snapped. I had to borrow money from family to keep from being evicted. I knew I was going to have to change something to keep that from happening again.
What did she change?
1) Adjust your attitude.
Is your attitude towards money always focused in the present and never in the future? Angela writes,
In my case, I chose to ignore my financial reality and live beyond my means, so I never got ahead. To help myself change my attitude toward money, I made a list of goals and rewards.
Her goals included someday being able to own a home and take a vacation.
2) Create a savings-friendly budget.
Surprisingly, I had a budget, but it was a horrible one that only accounted for my living expenses. It looked something like this:
- Monthly income – $1,800
- Rent – $750
- Utilities – $85
- Cell phone – $85
- Internet – $45
- Remainder – Spend on whatever!
I didn’t budget for any of life’s other necessities like toilet paper and food, and I didn’t plan for the future. As a result, I paid my bills, put the minimum amount due toward my credit card, and wasted the rest of my income.
Now she puts 10% of her income into savings every month….and she does remember that she needs to spend money on toilet paper.
3) Track spending.Even after she budgeted, Angela was still running out of money until the month she saved every receipt:
All of those $2 purchases here and there, running to the store to get one thing I forgot, or buying a pricey latte were killing my budget.
There are lots of online apps like Mint which can help with this.
4) Trim the fat.
We can’t put it any better than Angela does here:
Once I got my spending under control and had some money set aside for emergencies, I started focusing on one of my bigger goals – paying down my credit card debt. I figured out how much I owed, about $2,500, and set a one-year goal date to pay it off by. To do so, I was going to have to come up with about $210 a month to pay toward my credit card.
To get what I needed, I trimmed some things I really didn’t need or even use that often out of my budget. Here is what I cut:
- Cable TV – $65
- Gym membership – $45
- 3 magazine subscriptions – $33
- Monthly hair color at a salon – $85
Now I watch Netflix, take my dog for a run every day, read blogs, and keep my hair my natural color. I don’t miss any of it, and I was able to pay off my debt in a year. The following year, I started putting that extra money into my “vacation funds” account. Trust me, seeing my favorite bands at South by Southwest in Austin, Texas, was better than sitting in my living room reading Cosmo.
5. Don’t trade life experiences for money.
Angela found ways to go out every weekend and do many fun activities all without spending a dime:
So I went to my city’s tourism center and made a list of every free activity I could find. I found free concerts, firework shows, festivals, parks, and museums. Now my friends and I still go out every weekend. I still buy the occasional ticket to see the Saints play or eat at a nicer place, but most of our activities are free.