Not knowing where to start is OKAY. Trust me, you are not alone. So many people struggle with those scary wandering around in the dark feelings when it comes to their money.

I grew up around the financial world. Budgeting and saving is like second nature to me. I have done my budget since I was 18 years old. Once I got my first real job outside of my family’s business and I LOVED shopping at Target. I had to figure out a way I could save money but also have fun and buy myself something I wanted.

Start With Your Budget

Start with your budget. Your budget is the road map or blueprint to guide you where ever you want to go. Budgets are LIFE. Every month I customize my own budget along with my monthly clients so we can see our areas of OPPORTUNITY. These are the categories you overspend in. Monthly adjustments are something that keep you in check with your goals whether short term or long term. It’s all about Balance, Consistency, and Discipline.

Setting a Realistic Budget

Setting a realistic budget means diving into those sticky areas of your life and seeing what type of spending you have been doing. What type of categories do you have within your budget? Do you have long term goals? Do you have debt? By answering these questions you can track these and make sure every dollar has a purpose. I have a great blog post about the foundation of a budget that you should check out called Budgets: Foundation for a Solid Budget.

Balance

Balance is key in life in general but especially within your finances. You need a balance between spending money and saving it. You should be spending money on bills plus any irregular expenses that pop up throughout the month, but you should also have a “Savings” & a “Retirement” category to toss money in each month as well. These categories being in your budget will ensure you add money to it if you are also consistent and disciplined.

Here are some ways to bring balance to your financial life:

• Set some goals
• If you are a small business owner, pay yourself on a schedule
• Have an emergency fund
• Create a debt payoff plan
• Utilize tax-deferred investment plans
• Create a Will

Consistency

Consistency is so important when it comes to your budget. You have to keep up with your budget to see results. REMEMBER, it is just a blueprint for you to follow. It should not feel like a restriction, but more like a structured guideline that helps you figure out what your areas of OPPORTUNITY are. Consistently checking in with your spending is like going to the doctor for a check up. It keeps you healthy and aware.

Here are some ways to stay consistent with your finances:

• Increase your knowledge
• Increase your income
• Change your money habits
• Be rich, don’t look rich

Discipline

Discipline is hard. I feel you. We all have trouble telling ourselves no. I love buying gifts for my family and friends. Something I have to constantly check in with is WHY I want to spend money. I used to shop A LOT and I racked up a huge credit card bill which took me about a year to pay off. I use that as an example when talking to myself about why it’s probably not a good idea to buy that $400 purse.

Since having kids though, I have transitioned my way of thinking. I now appreciate experiences more than “things” or “stuff.” I want to provide my children with life experiences and teach them to be kind humans rather than purchasing things trying to look “cool.” It is definitely a priorities game. Whatever is a priority to you will end up on your budget. It’s all about Balance, Consistency & Discipline.

Here are a few ways to stay disciplined in the new year:

• Set some financial goals
• Use automation for your bills
• Give yourself a challenge
• Change your money habits
• Get an accountability partner or financial coach

Free Gift

Check out the FREE video series on my 3 Keys to Unlocking Your Financial Freedom! This video series touches on Budgets, Tackling Debt, and Ways to Increase Income TODAY! I created this series for those of you who have been hit hard by COVID-19. I want you to know there is nothing you can’t accomplish and creating a plan of action is always a great starting point.

Accurate Spending Categories

You need to have accurate spending categories to see where your money is going each month and where your areas of opportunity are. Some people over spend in their grocery category or their misc purchase category. These categories will be very unique to you and what your life entails. My categories range from pet medications to my daughters school fees to utilities for my home. It just depends on what you have going on.

Accurate Income Projections

This requires you to print out bank statements from at least 3 months and go through your income to get an average income to put on your budget. Some months may vary with different circumstances. If you are doing a new budget system currently but you have been laid off due to COVID-19 that would be a circumstance where you have zero control. You do however have the opportunity to pick yourself up and generate income by any means necessary.

Categories for Irregular Spending

This means a category for random things that come up each month or new subscriptions you’re paying for. Typically your budget will come in close to what you project but there will be times where you overspend at Target on clothes when your budget only called for groceries. This means you have budgeted for these things in that irregular spending category to cover times like this where you purchase many different types of things with one type of budget. Like going to Target for groceries and buying clothing at the same time.

Tracking Cash Purchases

Tracking cash purchases might not seem like a big deal but it is crucial to keeping tabs on all your purchases. If you are really trying to keep a close eye on your transactions then I would recommend getting the Microsoft Office Lens app for your phone and taking a picture of all cash receipts and then putting them in a folder on your phone or the Google Drive for safe keeping. This is great especially for self employed individuals to keep track of cash purchases and business expenses for tax purposes.

Plan for Major Purchases

You must always keep a list of ongoing goals whether they are short term or long term so you can incorporate them into your budget each month. You should have accounts called “sinking funds” for these goals.

7 Sinking Funds to Include in Your Budget:

1. Christmas
2. Important Birthdays/Events
3. Car Maintenance
4. Home Repairs
5. Pet Expenses
6. Travel
7. Medical Costs

4 Rules For a Successful Budget:

1. Give every dollar a job
   • You’re the boss. When you earn money, you prioritize how you’ll use it.
2. Embrace your true expenses
   • Turn large, less-frequent expenses into manageable, monthly bills.
3. Roll with the punches
   • Be flexible and address overspending as it happens. No guilt necessary.
4. Age your money
   • Consistently spend less than your earn, and be more than prepared for the future.

Those negative feelings associated with money will subside- the stress, anxiety, confusion, and shame gets replaced with confidence, calm, and even joy and excitement as you really start to feel in control of your money and tap into the potential of what it can do in your life.

1. Keep your small business finances out of your personal finances
   • This one is huge! Co-mingling business and personal money may seem easier, but it can lead to complications down the road. Keep a record of your business expenses to take advantage of available tax benefits. It also can be risky to use personal money to fund your business as it increases your personal liability. Person and business finances are equally important for success and keeping them separate will help.
2. List your expenses
   • Next, you’ll need to know exactly how much your business is going to cost to run daily and monthly. List out all your expenses, rent, employees, supplies, services, etc. Make short-term and long-term projections with your income.
3. Budget for your wants
   • If you’re planning ways to improve your business, be sure to budget for them, and save until you can afford them. If they are not necessary for your business to run well, there’s no need for you to go into debt.
4. Know what to expect from your business income
   • Relying on your business to provide for your family takes some planning and knowing exactly how much money to expect each month. If you have no idea how to much money will come in, then there’s no way to budget and allocate your money to certain things.
5. Set a savings goal for expansion or security
   • Start a savings plan for your business. In order to expand, hire more people, and provide security for your family, its important for small business owners to set aside small amounts of money to have long-term financial health. Small business owners often face difficulty saving money, since many have very tight budgets when they start. Saving from the beginning will help ensure you have some cushion in tough months.
6. Look for areas where you can cut costs
   • Efficiency and frugality will help your small business succeed. I recommend taking inventory of your expenses every month and considering areas where you can cut costs, not with cutting quality. I’m not advising cutting corners, but there are ways to save money and run your business efficiently without affecting quality of your product or service.
7. Be realistic
   • Make sure you have realistic expectations for your income and your expenses. Do your research, and don’t expand too quickly. Budgeting is essential for your small business success. Its important to keep your personal finances separate from your business finances so that you know exactly where your money is going and are able to easily provide documentation for your business taxes.

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