The title of this post is definitely a reference to The Last Five Years, so let's just start this out with that wonderful trailer.
Better already? I thought so.
A lot has happened over the last few months, but my biggest focus has been Project Money. I'm in the PM2 program, which is a smaller version of the public competition. It has been an incredible experience to challenge myself to do more with my money than I thought possible. My coach, April, helped me work out a budget back in June, and while many budgets need regular tweaks, mine has worked really well from the beginning. There were some varied expenses in the first few months while I transferred my credit card balances to a lower rate card and unexpectedly had to buy a car, but I got through that and have been sticking to the budget diligently this fall and winter. Below I'll share some of the things I've learned so far.
- Don't just blindly "save." I used to just have one savings account where I put money if I had extra at the end of a pay period and which I regularly drew from whenever I had a large and/or unexpected expense. It wasn't working. Now, I have savings accounts for emergencies, gifts, travel, entertainment, and fashion/decor. I have automatic transfers set up to deposit a set amount (per my budget) into each of these accounts each time I get paid. That's how much I have to spend in that area, period. It's one thing to look at the balance in your savings and checking and think, "I can afford this ..." and another thing to see $37.50 in your travel budget and think, "Nope, not going to take that road trip this month." I also find it helps me plan ahead. If know tickets are going on sale for a certain event next month, I make sure to minimize my entertainment spending until then so that I have enough in the budget for that purchase. It helps me make decisions. It also helps me remember to enjoy my spending occasionally. After a month of carefully tracking every purchase and not splurging anywhere, I glance at my clothing budget and think, "Hey, I can get a few new pairs of tights to replace the last few that have gone the way of giant runs!" Holiday, birthday, and wedding/baby shower gifts are no longer a huge stressor, either. Yes, sometimes all of the accounts and budgeting feels restrictive, but much more often it feels empowering.
- Be creative - and patient.
- Document goals and successes. worksheets Summit provides have been incredibly helpful to that end. I plan to celebrate with gusto when I hit each of my goals, but not by blowing my budget. Instead, I'll likely divert a bit more to my entertainment or fashion accounts that month and pick up a special treat (for the best price I can find, of course!).
- Share your journey. As I've been more open to talking about money, it's been amazing how much I've connected with others. Friends have talked with me about their student loan consolidation and credit card payoff processes. I've been able to reference this project as the reason why I can't partake in a particular offer to do a pricy activity with a friend (but always offer an alternate suggestion!). I've been able to follow the experiences of the Project Money participants online, relating to and learning from what they share. Most of all, all of the ins and outs of finances feel a lot less overwhelming and are a lot more fun when it's a relatively open part of your life.