I have a confession to make.
I am an emotional spender. I spend when I’m happy, I spend when I’m sad, I spend when I’m angry, and I spend when I just can’t deal with my shit.
I have never been good at staying within a budget, let alone making one, but it is no excuse not to learn. Money has always been my Achilles heal I’ve just kept it hidden. When I was working, living paycheck to paycheck was my MO, and I could afford to do it, I didn’t want to, but it always seemed to work out that way. Once I got sick and took a hit to my finances, I spent a little less because I had other expenses like meds and gas to pay, but there way always plenty to use for my own mischief, enough to save for a car, enough to travel, enough to invest a little. It is different now.
Now it isn’t just me. I am part of a team, an us. For a while, I forgot that and went back to old bad habits. I was selfish and even though I thought I was doing good for us, I was really fulfilling my wants, not our needs. As a single, I could spend my way into “happy” oblivion and not have anyone to answer to but myself, now I am part of an us and irresponsible spending can leave us homeless.
Now I or rather we own a house. A big honkin’ pile of debt, something I was unfamiliar with, or at least up until now able to earn my way out of. It wouldn’t be such an issue if I could just go back to work, but as you know from previous posts its not that simple.
It is expensive this thing we call living, so if regular folks are having problems with managing money and debt, you can imagine what its like for someone who is chronically ill, disabled, or has cancer. I always thought it was just me, that I couldn’t live with in my means, but apparently many are in the same boat. According to The Canadian Payroll Association 48% of Canadians are living paycheck to paycheck, by choice or not1.
So with my confession comes a plan, a plan to get my shit together and learn to be financially responsible and debt free.
Step 1: Come clean – Very hard and embarrassing to do, but it is a necessity. Your partner needs to know what the money situation is. You are a team after all and honesty and open communication is key to a healthy happy relationship. If you’re a single then ask for help from someone you trust.
Step 2: Stop spending and figure out what’s going on! – For me it tends to be crushing life events like death, cancer, or my death and cancer that spur on a spree. What ever the reason behind the spending figure it out and deal with it.
Step 3: Keep track of spending – Save all bills or write all spending down. I mean it! Every single cent! You need to know where and how you are spending your money.
Step 4: Budget – Now take all that juicy information from step 3 and look at spending patterns. Make a list expenses. Determine what is a necessity or a want. Now calculate your income or any money coming to you. Take that amount and allocate it to your expenses first. Then take what’s left over and allocate a portion of that to your wants. The rest goes in the bank. I know not so easy. But we can do it!
Step 5: Follow the budget – Here is the really hard part, actually sticking to it, because there’s always something that comes up. A birthday or a party, or Uncle Bob is in the hospital, but that is life, something is always going to come up. If we do this right, it won’t matter what it is, we will be able to everything we want and more. Its this first bit, where we will learn to exercise restraint and maybe say no or come up with cost free ways to celebrate, or even cut costs in areas of our lives. I can tell you that my consumption of cheese has drastically reduced as has my shopping, only necessities!
Step 6 Review and revise – As time goes on and habits change or as savings increase and debt decreases, revision will be necessary. After all, these things aren’t written in stone!
Listen, I’m no professional and this is my two very flawed cents, so anything I say here is not and I repeat not advice from a professional. This is my way of learning and holding myself accountable. For those who want to join in this exercise, I will post what I’m doing and the tools I’m using to get through this process. Otherwise, please seek the help of professionals.
Until next time