How to Budget 101

I’ll be honest…I have always sucked at my personal finances, which is a tad ironic since I work in Finance.  But, in my defense, I have always told people that I understand WHAT to do, it is just DOING it that is the hard part.

When I was in college I wasn’t concerned much over money.  I worked a ton of hours but I was living like a broke college student and I thought that was the way things were supposed to be.  I made the mistake of getting into credit card debt because I felt the need to live above my means.  Looking back, I probably should have listened to my Dad and created a savings account instead of buying $400 Michael Kors purses making barely $20K a year, but hindsight is always 20/20.

Over the past two years since landing my “big girl” job as a financial analyst at Disney, I decided that it was time for me to tell my money where to go.  I was starting to bring home big checks for the first time in my life but found myself STILL over-drafting in my bank account and struggling from paycheck to paycheck. If you live paycheck to paycheck, spend everything you make, and really feel like you have no idea where it even all went…hey – I’ve been there.

My inspiration to start budgeting came from a man named Dave Ramsey.  A lot of people have heard of him, some love him and some hate him, but I personally feel like a lot of the things he says are no-bullshit – they just make sense.  I found Dave through Pinterest and now I listen to The Dave Ramsey Show podcast on my way to and from work every single day.  It helps me stay motivated to get out of debt and it is free to listen to!

The most important part of getting yourself out of debt and building wealth is budgeting – telling your money where to go.  When I first started creating a budget, I was shocked at how much I was spending on groceries, fast food/restaurants, and random things like subscriptions.  Without a budget, you are not prepared.  Without a budget, it is way too easy to fail and lose track of your expenses.

Now I’m not saying that I’m a perfect budgeter…in fact it takes a lot of practice.  Similar to a diet, it takes a little restriction and learning how to say “no” to yourself.  I have found over the last few months that once you start using a budget, it gets easier.  It also gets to be more fun to see how much you can pay off or save in a month.  It is so much simpler to keep track of your money when you have one.

I used to be afraid to check my bank account for fear of overdrafts or unexpected payments being taken out…now I know EXACTLY what I’m spending my money on and I no longer have to struggle to find the money for rent the last week of the month.  (I must also say I was able to quickly notice a fraudulent charge on my bank account thanks to the fact that I budget and was regularly checking my statement)

Now you may be thinking this is all great, but how do I do it?!  Luckily my answer is EASY.  I do all of my budgeting through an app called EveryDollar.  It is the app Dave Ramsey promotes to everyone to use and because I am now a part of the Ramsey cult following (lol) I gave it a try and I LOVE IT.  I shared it with my sister and she is hooked on it too.

The best part about the EveryDollar app is that it is FREE.  There is an upgraded version you can get if you want to connect your bank account, but I actually prefer the free version where I can type my transactions in myself.  It is user friendly and has been my helper in being able to pay off thousands of dollars in debt over the last couple of years.

If you fail to plan then you plan to fail.  This is a quote that I’ve heard so many times and in this case it really is the truth.  Plan where you spend your money.  It takes a little thought the first time you create your budget, but it only gets easier.  Stick to your budget and I promise you will find that you can financially accomplish more than you realize.