Although I thoroughly enjoy blogging, it is, at the moment, just something that I do on the side in whatever spare time I can muster together. I’m a marketing manager by day—I manage traditional and digital marketing efforts for two dealerships. I also manage a significant marketing budget for each dealership each month.
I must admit that I have never been the type of person who was known for managing money well. In fact, a little voice in my head told me that maybe I should reveal this little, probably significant, detail to my employers before taking on the position. You know, so that they could make a well-informed decision and all.
Okay, so I’m exaggerating a little—I’m not that bad with money. However, it did take some time and some meticulous effort on my part, but I eventually got the hang of managing such massive budgets. Then one day it occurred to me, I was doing a pretty decent job managing a marketing budget for two dealerships but a lousy job managing my personal budget. What was that about?
Regrettably, the importance of saving money and adhering to a strict budget did not catch on for me in the early years, despite the repetitious urging of my dear old dad who would insist that I start saving for a rainy day. Why, oh why didn’t I heed my father’s loving warnings? Well, better to start late than never at all, I suppose.
I realized that if I wanted to start blogging and eventually turn it into a business, it was crucial that I got my personal expenses together first. If not, there was no way that I would be able to efficiently juggle both my personal expenses and that of my business. So how did I get started?
Have the Correct Mindset
Well, I knew that if I wanted to be successful at creating and sticking to a budget, I needed to have the proper mindset. You see, when you manage a budget for someone’s business, you must report to a boss. However, when managing your personal budget, the possibility of becoming lax and not giving your full meticulous effort is there because you are not answering to a boss. You are answering to yourself, and we tend to be lenient with ourselves.
I would need to treat my budget the same way that I would a business. I had to be strict on myself. After all, I was my own boss in this scenario, which meant there was some accountability—to myself.
Know Exactly What You Spend
I would log onto my online banking account and see what I spent my money on, and I would do this on a regular basis. I thought I was staying on top of my spending by doing this. However, it always felt like I was spending more than I should but I could never figure out why.
Let me tell you; there is nothing like having all of your expenses written out in black and white to give you a full understanding of exactly what you’re spending. I redrafted the spreadsheet that I used for the dealerships and made one specifically for my personal expenses. I made a section for my savings, a section for my monthly expenses, a section for my debt, a section for my business (this blog), and a section for miscellaneous spend.
Then, for that first month, I went through each transaction in my bank statement and put each charge in its appropriate section. I was amazed at how much I was actually spending each month. What bothered me the most was the fact that I was paying about $1 a month on a recurring membership to learn Spanish, which I only used the first month and completely forgot about the membership immediately afterward.
I was throwing away $1 a month. But, I do that. I shamefully admit that this isn’t the first time a recurring charge got the best of me.
Once I had the sums of each section all written out, I was able to see what areas I needed to cut back on precisely. As a result, I set spending limits for myself in each section and started cutting some unnecessary expenses. For example, I was paying nearly $100 a month for my cell phone service with a mainstream company. After doing some research, I later switched to a smaller phone company and am now paying $55 a month for my cell phone service.
Set Realistic Payment Plans
After I was able to cut out some unnecessary costs, I started to focus on paying off my debt. Before I could do that, I wanted to make sure that my necessary monthly expenses were covered. This included setting up a high yield savings account. So I searched for a bank that would pay a monthly interest.
As soon as my monthly expenses were all accounted for, I decided to allocate a certain amount that I could spend towards my business each month. Then I set up personal plans to pay off my debts.
The months that followed, I made sure that I logged each time I spent money and on what. At the end of the month, I would cross reference with my bank statements. At the end of each month, after I paid myself, my expenses and so on, whatever extra money I had left over would go towards my debt in efforts to pay them off quicker.
As long as I stayed within the budgets that I set for myself, I was all right. Each month I allocated a certain amount for dining out and shopping, etc. So I never felt deprived of doing the things that I wanted to do, I just knew that there was a limit in which I needed to adhere.
Setting up a budget was one of the best things that I ever did for myself. I no longer feel like I’m living from check to check and I’ve adopted smarter spending habits. What about you? Have you created a budget? How has it helped you? Let us know in the comments below. Also, download my free Excel budget template below.[emaillocker]