My budget is currently sitting at $294.13 in the red. A year ago, when I was just starting to work and I was trying to dig myself out of nine years of medical school debt, this would've caused me to panic. Or more realistically, I never would've gone $294.13 into the red. I would've eaten rice and beans and said no to get togethers with friends to keep myself from ever going over budget.
Now, I barely notice. When I hit a positive net worth, my stress level about money dropped, and I have gradually gotten less and less worried about money as my savings have climbed. Slowly, I've reintroduced things into my life that I've forgone over the past two years: fancy drinks in restaurants, expensive cheeses, clothing of any sort. And it feels really nice.
I'm not entirely sure what to do about budgeting at this stage. Even with being over budget, I'm saving over 2/3 of my earnings, so I am more than meeting my financial goals. I don't really have to budget anymore; and yet, there is part of me that doesn't want to abandon budgeting altogether. Part of it is for the reasons I outlined in a long ago post about why I continue to be relatively frugal. But it's more than that.
I think a huge part of me worries that I'll go back to my terribly consumeristic ways if I stop budgeting. Before I started budgeting two years ago, I had developed an almost instinctual habit of buying whatever I wanted. Whether I was shopping for clothes or eating in a nice restaurant or ordering books online, I would simply buy whatever appealed to me in the moment with the knowledge that it was going on my line of credit and I wouldn't have to pay for it until I was an attending*. I would take whatever boredom or loneliness or exhaustion I was feeling and try to spend it away. Always unsuccessfully.
Starting to budget made me much more mindful of my spending. It made me realize that I often wasn't looking for a new thing when I went shopping, but rather for some feeling that I was missing. A lot of the time, the best thing I could do when I felt like buying something at random was to just go have a nap, as I've been chronically tired since my first day of medical school in 2006. It also made me focus on non material ways of being happier, rather than on buying a new pair of happy socks. (Although I really love happy socks. And am now searching their website thinking about placing an order. Well done, me. You've clearly learned your lesson.)
I guess what I'm looking for is some way to be intentional with my spending while not feeling constantly constrained by my budget. I want to take advantage of the fact that I'm earning ridiculous amounts of money for a single woman with no dependents, without thinking that I can somehow buy happiness. Balance. The endless search for balance.
Any ideas?
*Thank you very much, past me. You are an asshole.
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To update you on my habits from a few weeks ago, I've been doing surprisingly well with them. I have completely resisted the cans of Coke in my fridge, and I've passed on pop multiple times in restaurants. I am allowing myself to have pop in mixed drinks (something I decided to do in the beginning but didn't mention in my previous post because I was lazy), but in total it's been about one can of pop since I started. I almost always put my things where they belong when I get home, which has made leaving in the morning much more efficient and peaceful. I've also started putting my keys/wallet/phone in specific spots in my bag (my bag has about 8 different spots, so searching for something can be frustrating), and that has also been a huge improvement. Finally, I have planned out my weekly schedule every Sunday night, and it has given me a bit more awareness of the week and a big more structure. It also saved me from missing dinner with a good friend this week (I thought it was on Thursday, but it's actually on Tuesday), so that is also a win.
Well done, me.
Why not increase you spending budget? Instead of saving 2/3 of what you earn, save 3/5 or 5/8. Give yourself permission to spend a little bit more, but stay within the new budget. Set the amount of savings so you are still putting away a good bit but you don't feel deprived all the time
ReplyDeleteIt's hard for me to know how easy it is for you to fall down the consumerism rabbithole again, but it sounds like you have learned some good habits. What about loosely keeping a budget - no line items, but just a "I have this to spend each month" and have only that in an account and it's easy to keep an eye on that. If you find yourself maxing it out, then go back and do a more detailed analysis to see where you're overspending.
ReplyDeleteThe hope would be, I think, that you would internalize frugality. So instead of buying every book you want and going out regularly, you sort of intuitively know - ok, I can buy two full-price books per month or the equivalent at discount, and go out about three times per month at a mid-range restaurant. Special occasions can allow you to break the rules but only consciously - making the decision to overspend for a good reason.
I've always been frugal and that sort of thinking helps me. Lately I've been stressed about money because I had to buy a lot of things for hosting a bunch of people and some travel. I've had to accept that money will be tight but having people I love come to visit from Australia makes it worth it as well as all the costs associated with their visit. I'll feel better in a few months.
But 2/3 - wow! That's very impressive.
I am not a frugal person, and I'm given to just the sort of impulsive spending you describe. I grew up pretty poor, and the minute I had my line of credit, I adjusted my spending habits accordingly. I often wish I could go back and fix that.
ReplyDeleteWhen I notice that I've been spending a lot, I'll designate a week or a month as a 'no-buy' period. I'll write in my planner 'no pleasure purchases' as a goal for the week. I find this helps it stick in my brain that I'm not going to be spending freely during this period of time, and I actually end up saving quite a lot of money. At the very least, it means that I'll have to push my purchases to a later point in time, and doing so often gives me the opportunity to realise that I don't really care about those particular purchases anyway.
The other major change I've made that has had a surprising impact on my frugality is riding my bike everywhere. Not only am I saving on gas (a surprising amount, too! Before yesterday, the last time I purchased gas was in early June!), but I'm also not inclined to buy things because I know I'll be carrying them home on my back. This doesn't do much to curb my online purchases, but it does make me less likely to pick up impulse items at the grocery store or on my way home from work or the gym.
I don't *do* budgets - I've tried a bunch of times, and just lose interest and don't keep it up.
ReplyDeleteSo what seems to work for me, mostly, is to set up online bank accounts for all of my obligations and savings goals - I have one for vacation fund, one for property taxes, etc. I have automatic transfers done right around paydays to pull the allocated amounts from my checking account, where my paycheck is deposited, and into the separate accounts.
Whatever is left, is to cover groceries, utilities and everything else - I can spend it on whatever I want, without guilt.
Admittedly, this worked...better, when I was using my debit card for all my transactions, as I would keep a general track of my balance and if it dipped too low, I would automatically course correct. But with the rash of retailers having data breaches, I switched to using my credit card for everything - which means that when the bill comes due, I'm not always as on target as I should be - I don't have that hard limit that my account balance was giving me :D
This post from Ask A Manager reminded me of your posts about budgeting. You might enjoy reading it: http://www.askamanager.org/2016/08/interview-with-a-budget-and-money-coach.html
ReplyDeleteSo glad I'm not the only one who has happy socks!
Kudos to you for all the hard work, you're doing brilliantly.