30 January 2013 - Budgeting

One of the biggest concerns for this generation is our tendency to spend more than what we earn. That, coupled with ever increasing possibilities to "buy now and pay later" is leading to a frightening amount of generational worldwide debt.

A little gem of advice my Dad offers me (and any young person who will listen!) that makes a difference in living a life with less stress and more happiness is to "live within the budget." Now that I've reached my mid twenties I think I am finally grasping what this means.

My husband and I are spending this year on a budget.

We started by making an excel spreadsheet that details our annual expected bills - then we deducted this amount from our expected incomes. We then determined what amount we can use for week to week expenses - groceries, fuel, dining out, pet food etc. We set figures which push us to be mindful and look for ways to save money in this areas - like using fuel vouchers, shopping at the harvest market for groceries and ordering pet food in bulk on-line. With these essentials all covered we added a budget for personal allowances and for time spent together or dates - so we're not missing out on anything.

Each week these designated amounts for fuel, groceries and allowances go into separate envelopes as cash while the money set aside for bills accumulates in our account until they are due for payment. If you want to make it really fun and creative you can decorate your envelopes too.

What will we do with what's leftover after all this each week? A portion automatically goes into a separate ''rainy day' savings account. The use of any income left after that is up for discussion - we could put it towards travel, a gift for someone, additional savings or our home renovations  It's up to us how we spend extra money but at least we know whatever we decide to do with it we are not neglecting our bills, weekly expenses or savings for a rainy day by spending it.

I have spent a large part of my life not thinking strategically with money like this - of having a f**k it attitude and spending my money as it came in from week to week; and I can tell you that budgeting your money not only benefits you in the long run but it feel's so much better when you do. It also actually makes it feel like we can afford more. More of what we really want, as we spend less on what we don't really need.

I also enjoy the way it gives me and my husband our own allowances or personal money to spend as we please. I'm going to see if I can save at least half of mine up for the year. My Dad did this with his "allowance" when him and Mum were first married; and bought his own motorbike.

I guess he's pretty good at taking his own advice too.