I am no housewife, nor am I a wife to begin with; but I like budgeting my money. I don’t believe that you need to manage an entire household before creating a budget.
Come to think of it; this could be a good preparation for the real thing *wink
In a blog post I wrote two years ago, I provided an overview of how I budget my money. I wrote that when I was still working as a nurse.
When I shifted careers to be a writer, I noticed that I was able to take home more money. I regard this to the fact that I now have more control over my time so I am able to take on freelance writing jobs (thus, extra income). I am also lucky to have started properly managing my money even before I shifted careers so I became more accustomed to budgeting and it now becomes a habit.
In the blog post I was referring to, I wrote there that every time I receive my salary, I make it a point to devote a few minutes figuring out how much goes into which expense or fund. I still do the same today, though some things have changed a little.
|EXPENSES||Allocation||If I make P20,000 monthly…|
|Transportation (public transportation only, no Uber, Grab, etc)||20%||Php 4,000|
|Entertainment Fund (occasional eat outs – I bring packed lunch every day, night out with friends, personal needs, etc)||20%||Php 4,000|
|Retirement Fund (stock market investment)||10%||Php 2,000|
|Household Contribution||20%||Php 4,000|
|Travel Fund||10%||Php 2,000|
|Lasik Fund||10%||Php 2,000|
Disclaimer: I used Php 20,000 because I believe this is the average monthly income people my age make. This kind of budgeting also works for me because I still live with my parents so please take that into consideration. This is actually salary-based, not including other sources of income which can be done on the side like small businesses, freelance, stock market and many others.
[Related Story: So This Is How I Started Investing in the Stock Market]
As you can see, I am now better in Math, LOL
I learned this technique from Don Soriano, a licensed financial advisor through his book, Break Free.
Doing this for a fair number of years has improved my life significantly. Thanks to budgeting…
Tithing Becomes Less “Nakakahinayang”
Apologies to my non-Filipino readers, but ‘nakakapanghinayang’ is one Filipino word with no direct English translation. In this context, it refers to the feeling of regret for not having used something for a better purpose.
Because admit it, there’s this little feeling of regret when you drop your church contributions in the collection bag during Offertory, right?
Okay if you don’t want to admit, then I guess I’m the bad person in this conversation, LOL
I felt this before; especially considering that my salary isn’t that big to begin with. Sometimes, I thought I should have used the money for other things. My tithing was also based on whether I have spare change in my wallet. If I have nothing but huge bills, I stay away from the collection bag.
But all these changed when I started creating a budget.
Since I have a dedicated fund for my tithes, this responsibility (notice how I did not use ‘obligation’ here) becomes automatic. I don’t know about you, but with this habit alone, I feel that budgeting already did wonders to my life.
Give the Lord what is right, not what’s left.
Life Becomes Less Stressful
With all the problems that adulthood brings, money isn’t something that I want to exhaust my time, energy, and brain cells to. I just want to do the things that make me happy and enjoy every living moment. My budget helps me achieve this. Even if I don’t make much, I know I have enough because I have carefully planned how I will spend it.
Making 5-digit salaries is pointless if days before the next pay day arrives, you don’t know where to get your lunch or transportation money.
I have this friend whose salary is three times more than mine but has very little idea why despite this huge salary, she has no savings. I once went shopping with her and before I knew it, her cart was filled with sweets, chips, cute Korean adhesive tapes, and all other non-essential goods. I then pointed out that this shopping habit could be one of the reasons for her lack of savings.
Here’s one of my favorite quotes from online marketing guru Peng Joon:
It’s not about how much money you can make, it’s also about how much you can keep
It’s Easier To Say No
Don’t you just love it when your friend volunteers to buy your group’s air tickets when there’s an airline seat sale?
I do too!!!
I mean that’s another awesome trip in the making so who wouldn’t be excited?
However, before I say yes to my friend with the credit card, I consult my travel fund first. If I don’t have enough money for the trip, I instantly say NO.
I’m glad I have friends who don’t unfriend me whenever I do this, LOL
This particular trait is called “delayed gratification”. It refers to the ability to put off something pleasurable or fun because it isn’t the right time yet, there’s no enough money for the expense, or just simply putting it off because the resources are being saved for something bigger or better.
This is one of my take-aways from the many personal finance books, blogs, and seminars I have invested time to.
And To Say Yes
On the other hand, if upon checking my funds and I see that I have enough money for a particular purchase, I don’t waste another minute to say YES!
I chanced upon a great deal of Php 60,770 for Lasik Surgery. This is certainly a far cry from the Php 140,000 regular price. Since I have been saving for this surgery for almost three years and my Lasik fund was enough, I jumped at the opportunity.
Seven minutes and Php 60,770 later, it was like I was born again with 20/12 vision.
You might be thinking: “This is bullshit, she couldn’t possibly live on that meager salary, travel, and have Lasik!”
My answer: “What if I do and so what if I don’t?”
My point here is it is important to properly segregate whatever income you receive monthly. A budget doesn’t have to be limiting. In fact, it should help you feel comfortable and secure; without restricting you on spending on the things you deem important (in my case, travel, Lasik, and entertainment fund).
Ultimately, create a budget possible enough for you to stick to. I did several revisions on mine before I finally found one that works for me. It’s a great feeling to be able to have full control on my spending and not give in to hasty purchases that I would later on regret. #adulting