I’ll admit it – when it comes to personal finance, and budgeting (and more importantly following a budget) I’m pretty awful.
As a kid, I was pretty good at saving my money – but with sweet babysitting gigs, no expenses, and no malls or fast-foods joints within 300km, it was pretty easy. But even as a university student, I did alright. Every semester, OSAP (student loans) gave me more than I thought I needed, and a good chunk of it would end up in the bank. I worked multiple odd jobs and work study positions for my first two years, before landing a permanent part-time office job on campus – working 20 somewhat flexible hours a week, with my own office, my own assistants (usually just one but at one point I had 4), and getting paid almost double what minimum wage at the time was. Overall, I didn’t worry about money beyond having to get up early twice a year to avoid spending half a day in line to get my loan applications in. To be perfectly honest, at one point as a student my savings account actually reached 5-digits. (But that didn’t last after only a few month of unemployment.)
I was very fortunate and found work before completing my post-grad program. I had already moved across the province, (spent most of my savings) and started my new job before my final project was submitted. One would think that with a regular paycheck, living alone, eventually getting a car, and all those other “grown-up” things that budgeting would come into play at least a little bit, right?
I did check my credit report – once… about 4 years ago. I was making $400/month contributions into a TFSA for several months before getting a car, and then $200/month for about a year afterwards. But for 2012, my total contribution to date is a whopping $300. Every new year I set up/tweak a budget plan in Excel and keep all my receipts to enter into the budget and do that all of about a dozen times before the shortcut on my desk-top just blends into the wallpaper. And last month when I got my (first) new smart-phone, one of the first things I did was download a money-managing app. My last entry was September 13th. I guess me and personal finance are not friends after all.
As an employee in the not-for-profit world, I don’t make a lot of money. As in, I had to get a second, seasonal part-time job. I really like this part time job, but working 6 days a week, with at least 4 of them being 13-hour days is exhausting. Here I am paying $45 a month for a gym membership that I never have time for. I applied to do volunteer work once a week with kids, but had to post-pone starting. I buy at least one fast-food or take-out meal a day because I only have two 1-hour breaks to cook, eat, clean, and run any errands that need to be done (and oftentimes I have use this time to shop for supplies for the second job). When I do buy groceries, I buy too much (not knowing when I’ll get back there) and sadly end up throwing some/most of it away. I probably end up spending close to the same amount that I’m bringing in from this extra job. Ok, probably not, but I certainly spend more and pay less attention to my finances when I’m working both jobs then when I’m only working the one.
I don’t have a mortgage or any consumer debt. My credit cards always get paid off at the end of the month. All I have is my car loan (for another 2.5 years) and my student loan. Mind you, my student loans are enough to buy a house in this area – or nearly twice my annual salary. Yikes. I wish I would have been more diligent with either saving what I had considered my “extra” student loans or just not accepting that much in the first place. Here I am, more than 3 years out of school, and have less than 3% of the loan paid off. At this rate, it’ll be paid off in only 22 years! Woo!
I have my (invalid) excuses for why I’m so bad at this budgeting thing, in addition to working too much:
- Every 6 months I have to reapply for repayment assistance for my student loan, so this amount changes twice a year.
- My landlord is a dick and goes weeks, if not months, between cashing my rent cheques.
- I never know how many hours I’m going to work at my second job.
- I make tips at this second job, which is also unpredictable.
- Gas prices are always changing. As is the amount that drive.
- I don’t (think) I’m a lavish spender, or buy things I don’t need.
- The boyf accidentally killed my piggy bank and I can’t find a replacement.
Last year (and several times since) I was seriously considering quitting my second job. (And when things at my day job get bad, I consider quitting this one, too, but who doesn’t!?!?) But there’s that whole money thing… While a benefit of living in this smaller city is that it’s affordable, a downside is there aren’t a whole lot of jobs. Especially in my field. Trust me, I look pretty regularly. Unless the magic job fairy appears, or I get a roommate/shack-up, it seems I have two choices: keep working both jobs and somehow find a better work/life balance so I don’t lose my sanity/social life/waist-line; or learn to budget better so I can cut back to just one job. (Realistically I should be doing both no matter how many jobs I have.)
But how does one actually follow a budget?? I, of course, turn to Google to answer all of life’s little problems. And Google tells me I have a few options:
1. Turn in the plastic for the paper.
Apparently, “spending actual cash is an activity that is interpreted as pain by your brain, and you will naturally try to avoid spending it.” That’s what Gail’s “Jar System” is all about, and she seems to know what she’s doing. But this takes planning and discipline, and like everything else, I’m not sure I’d last beyond two weeks without being on tv and/or possibly getting $5000 for following it for a month.
2. Make things as automatic as possible.
I’ll admit, when I was automatically contributing to my TFSA, I often forgot that I was putting all that money away. When it did cross my mind I would check on my account and be pleasantly surprised to see not only how much was there, but how much interest it was accumulating! (Thank you, ING!) This is pretty effortless, and I have no excuses not to get this going again.
3. Set savings goals.
“It will be easier to stay on budget if you focus on the reason you are saving money rather than focusing on the little things you have to give up.” This whole blog of mine is based on “setting goals”. 101 of them to be precise. But only 2 or 3 of them really apply to personal finance (#81 – Pay off $5,000+ of student debts, #84 – Consult a financial planner & create a savings plan, and somewhat #81 – Go one week without buying anything). I am slowly chipping away at #81, but have zero progress on the others.
4. Tracking, tracking, tracking.
I know that I eat most of my disposable income. But because I’m not tracking it, or setting a limit, those $3 coffees and $8 subs don’t really seem that bad – until you do the math. Even if I only spend $10 a day not eating at home (I definitely spend more), that’s $300 a month on just ONE meal. Do this for all three meals and that’s $900. There is NO WAY I would ever consume $900 worth of groceries in a month. This right here is my problem. Maybe I should try a new app.
5. Planning, planning, planning.
Meal planning. Ugh. I hate it. I hate cooking. I hate doing dishes. I’m not even a big fan of food, period. But I also hate how much food I waste. And how much packaging take-out and meals-for-one have. And the gas I waste driving to pick up one thing. But I really, really hate when last year’s pants don’t fit. Like the other 2 million or so monthly active users, I waste a lot of what little free time I have on Pintrest; about a quarter of my “pins” relate to health & fitness. So, I spend this time (passively) pinning these things, but no time (actively) planning these things.
I will never, ever, ever, stick to a budget if it deprives me of the things I want. And I think that’s a significant factor as to why I keep failing at this. Instead of taking baby-steps to cut back on this, and do more of that, I assume that I overnight I will shift into Super-Me, and all those bad habits have been replaced with good ones without fail. Or I “treat yo self” a little too often and too freely – like, when I do manage to find the time to hit the gym, I “treat yo self” with ice cream or chocolate or both. Or when I make a lot of tips in one night, I “treat yo self” to something like, a new cell phone. Whoops.
Writing this out, it all seems so simple – so why is it so hard?