I never met a trip I didn’t want to take, a meal out I didn’t want to eat, and a dress I didn’t want to own. In other words, if I followed every spending impulse I’d be dead broke. Unfortunately, early in my adult life this is exactly what I did. Having access to seemingly endless credit and what at the time seemed like an endless paycheck meant I bought every little thing that caught my eye. My family got lavish birthday gifts, I treated friends to meals, and I treated myself to spa treatments and mini-retreats to go shopping in Dallas.
When my income didn’t cover my monthly expenditures, I shrugged and carried my credit balances over making only the minimum payments and exploding my debt. I reigned in my spending a bit after a few bad months, but still kept coming up short at the end of the month. After sitting down one teary night of number-crunching, I realized that I had willingly dug a financial hole for myself. I had to do something or risk getting buried in it. I considered drastic measures: black market organ dealing, writing hit screenplays, applying for grants. Ultimately, after a sensible phone call to my father I opted for a simple solution. I set a budget for myself.
My first step was establishing my need to haves (shelter, food, transport to work) versus my want to haves (trips to London, adorable kitten heels, rodeo tickets, and basically everything else). Evaluating what I needed to spend in a month just to live was a big reality check. It cut down on my superfluous and exorbitant spending quickly. I looked at ways to maximize my budget and run my life more efficiently. I researched energy savings at www.TexasElectricityProviders.com and cut down utility costs. I started eating in more, preparing myself simple meals. I stopped going shopping to remove temptations. I even hunted down a less expensive apartment to save on rent.
I still buy things I want, but instead of buying them on first impulse I save up for them. This has actually created a greater satisfaction when purchasing items and also gives me more time to make informed consumer decisions.
I recently purchased a great new laptop for example, but I did the legwork and made sure I selected the computer that best suited my needs and will last for several years. Spending less means that I have to be careful about which social invitations I accept, but ultimately I enjoy when I do go out much more now. I appreciate the time and I don’t worry about the expense or if I’ll go over my credit limit because I know exactly where my finances stand. I have big financial goals now too, I am working toward buying my first house. I have a nice nugget set aside for the down payment and then some.
I also created a pillar in my financial plans that I never even considered previously: investing. By budgeting my spending I have created room to start using my money to make more money. I have invested in a Roth IRA and made a few other longterm investments as well. Having my money in a place where it is growing versus evaporating gives me confidence about my future that I never had when I just tossed my paycheck at the nearest mall.
While initially constricting, setting a budget has set me free. My personal finances are no longer a burden and I look forward to making educated and fiscally sound decisions with my life.