I know we have talked about creating a budget and sticking to the budget. What we haven’t talked about is how all that advice goes right out the window when you are struggling to make ends meet. First thing first, be honest with YOURSELF. Most people use cards instead of cash (especially myself) so this made it extremely easy for me to track my purchases for the previous month. What I found out was that I was spending almost $600 dollars a month MORE than what I made. How? I was “saving” money in theory because I have always used the “pay yourself first” method. I was also using my credit cards throughout the month but instead of paying them off in full at the end of each month I was only making the minimum payment which was hurting me more because of the interest and balance building every month. Basically, I was just digging myself in debt without even realizing it. I know this is a budgeting a saving blog BUT I am ALWAYS honest. The first thing I did was gathered every single bill, subscription, need, want that I had and built a real budget. Once I had my budget complete instead of me paying the minimum on all my cards so that I wouldn’t get behind I started with the card that had the smallest balance and paid it off, and then I slowly moved up the ladder, the most important thing here though is I did not use my credit cards anymore. As of March 2021 I have been able to pay of four of my six credit cards while NOT adding anything to the balances of those cards. My goal for the end of 2021 is to have no credit card debt by December of 2021. I am not financially free YET, but I’m getting there!
- The Moment of Truth: List your Assets and Liabilities
- Budget for Saving: Record your expenses (paying into your savings will be an expense)
- Write down your financial goals both short term (1-3 years) & long term (4+ years)
ASSETS- This is everything you own that have monetary value.
LIABILITIES- Debt or financial obligation that you owe someone else.
Budgeting While Making Cents 