When Ben and I fight about money, the dispute tends to involve how to budget our joint funds. At the beginning of every year, we map out where we want the money to go and make adjustments throughout as we see how our spending unfolds. Our main conflict lately has been how much money we allocate for house furnishings, trips, and charity.
Laying down common goals and choosing where you want your money to go is one of the hardest parts about being in a relationship and staying on the right money track. Two different people often have different priorities.
However, putting in the effort and dealing with the initial stress of hashing out a joint budget will make your life much easier in the long run. This week I want to talk about establishing spending plans based on “ideal” budgets. But first I want to mention the number one quality that you need in order to become a successful budgeter.
Discipline.
You don’t fail at budgeting because it’s too complicated or it’s too hard to figure out. You fail because you don’t stay disciplined in updating your expenses to make sure you are on track with your goals. Eventually, week after week of neglect gets so overwhelming that you fall off the wagon completely because you feel like you have gone so long that you can’t catch up.
Budgeting doesn’t have a magic bullet that will put your perfect budget in place and make all of your money woes disappear. It takes steady monitoring and tracking of your expenses to develop a budget that fits your lifestyle and accurately reflects your relationship with your spending.
So the simple key to developing a good budgeting habit involves establishing a certain time frame that you will regularly review and update your budget.
I usually do it at least once a week on Sunday…Ben and I save our receipts, and I also go through our bank and credit card transactions. At the end of the month, I fill out my balance sheet, and match the transactions to our Mint account.
But you can do whatever works for you: once a day, every other week, or on the 15th and last day of the month. Use a day that gives you the best opportunity to take time out to review your finances.
As I’ve said before, modern technology and online banking allow you to easily track your expenses without having to enter everything yourself. You just need to make sure that your software categorizes the expenses correctly.
Of course you will have times when life is too crazy to keep your set date. Don’t panic. Just make a concerted effort to catch up once the stress ends. It may take a little longer but not letting the budget get out of hand will pay more dividends down the road. And if you do get to the point where you think can’t catch up, use that as a new starting point. Giving up completely should never be the final outcome for you.
Developing the habit of budgeting through continual discipline will make the process easier as time goes on. And who knows, you may get to the point where you love budgeting so much you couldn’t imagine not doing it.