Guest Blog: Barbi's Story (Part 2)

It just keeps getting better. g

Alright, so now we've got our budget all set up and ready to go. How do we stay focused and committed to it? How do we work together as a couple and stay on the same page? How are we able to pay off all the bills on a relatively modest income?

While we live very comfortably and don't feel restricted or limited by our budget, we are relatively careful spenders. We know our priorities and we don't nickel and dime on those things, but for the things that aren't priorities, we shop around for the best deals and we limit our spending in those categories. Let me use an example. For us, one big priority is where we live. Neighbourhood, safety, space (and closet space) and the condition of our apartment are very important to me, so we chose to live in a place with high rent. People balk at what we pay in rent and ask why we "waste" our money on it, but then I look at them and wonder why they "waste" their money on buying lunch each day instead of bringing their own, buying daily coffees, or going out to bars and buying drinks for $5 a piece. I wonder why people pay sometimes double the price for the exact same product at Loblaws instead of No Frills just because the interior of the store may be a bit nicer or because it has a certain reputation. I wonder why people spend $100 on pants when they could buy them second hand for $15.

But hey, everyone has their own priorities. The point is, you need to choose a few priorities; you can't make everything a priority. So for us, we spend a little extra on rent, we go to an expensive vet for our cats because it's a convenient location and has great hours, and as avid runners, we buy the best shoes that work for us without so much as looking at the price tag. Those are just a few examples but you get the idea. Budgeting doesn't mean you can't ever spend to get what you really want, you just can't do it all the time. To balance these things, we take lunch to work each day, we get just weekend delivery of the paper instead of daily, and we buy some of our groceries in bulk and some of our clothes second hand.

It's because of being able to differentiate between these priorities, being able to know what will actually make a difference to our happiness and what won't, that we've been able to set a budget that is easy to live on without feeling constrained. In fact, sticking to our budget has not only been easy, it's been fun! That's because we've made it a hobby of ours by finding software we enjoy using to manage it. Some people may like best to use simple pen and paper, or an excel spreadsheet. But for us, we make it almost a game by using a program called MoneyWell (and that's just one example, there are plenty out there and I've heard particularly good things about a web application called Mint) where we can set up "buckets" (these work just like the jars on 'Til Debt Do Us Part), record our spending, and get fun little graphs to show us how close we are to reaching our maximum allowance in each category for the month. I won't get into the details of all the great features MoneyWell has, but the point is, we don't think of it as a chore. In fact, I enjoy the challenge of sticking to a budget and checking up on myself to see how well we're doing. Find what it is that will make budgeting and tracking your spending enjoyable for you.

One last piece of advice: No matter how much you get into the groove and start actually looking forward to managing your finances, things are bound to happen. So, keep it as easy and simple for yourself as possible, and make contributing to your savings automatic. For us, this means having reminders on my calendar that pop up once a month to say "Deposit money into RRSP". For people with less discipline, it might mean having an actual direct deposit set up on your bank accounts that moves your money into your RRSP each month whether you like it or not. Only you know yourself best and know how much guidance you'll need.

But, there's one thing that's for sure. You're not too young to be in control of your finances, and your future. So go grab a book, learn a little something, put it into action, walk with your head held high, and make sure to have fun while you're at it.

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