Have You Ever Felt Good About Spending Money for Christmas?
Many people reading this are probably shaking their heads left to right just after reading the title alone. Why? If you are currently in debt and have no real budget then you probably have a lot of anxiety when it comes to money in general. There is always a feeling that you shouldn’t be spending those dollars because they should be going towards this bill or that debt, etc. The core of this anxiety comes from the fact that your financial world is clouded in uncertainty and questions.
- What bills do I still need to pay?
- Are there any expenses that I’m forgetting about this month?
- How much have I already spent?
- Should I be paying down my debt with this dollar?
- Can I really afford to spend this?
There’s nothing weird about these questions running through your head every time you whip out the debit or credit card to pay for something. In fact, it’s natural. Why? Well, finances can be quite a complicated beast and it’s very easy to lose track of exactly how much money you are bringing in and how much you are spending. It’s hard enough for most people that they tend to spend more than they are earning, which is what creates debt in the first place. There is no “good angel” on your shoulder telling you that there’s only $56.04 in the bank for the rest of the month so that awesome new jacket should probably wait until next month. What really happens is you have forgotten about a bill and think you have $200 and have plenty of money for the purchase. At the end of the month you’re behind and depressed.
So, Why Did I Feel So Good About Spending Money?
There’s no trick to this. I felt good about spending it because it was budgeted. In this particular case I was spending money on Christmas presents to take advantage of some online sales. I knew that I had $400 budgeted ahead of time for Christmas shopping so I was able to spend up to that amount at any time without having to worry. You might say: well that’s easy if you already had the money ahead of time! But, what if I told you that I’ve been “saving” up this money all year so that I would have access to it when I needed it?
You see, there are lots of ways to budget, but if you use any kind of a system that involves “zero dollar budgets” then you will be able to replace uncertainty and anxiety with knowledge and confidence. This is because you have up-to-date information on how much money you have to spend on certain things throughout the month. I’ll tackle the specifics of this in a future post, but here are the basics.
- Log all of your expected income for the month ahead
- Create separate categories for spending (Rent, Groceries, phone bill etc) and list them out
- Create separate categories for savings or irregular expenses (New Car, Christmas, Vacations, etc)
- Divide up your expected income to these categories making sure to budget every dollar
- Stick to your budget!
Does this sound easy? Yes! In reality of course it’s not quite as easy as it looks, but the logic behind it is very sound. You see, once you’ve put all of this information down in a place that you can easily track it and keep it updated you’ve removed the uncertainty from your spending.
The trick to my Christmas spending is in step 3.
I simply created a savings category called “Christmas” in my budget. Each month throughout the year I would contribute $20-75 of my budgeted dollars to this category which slowly built up over time because I wasn’t spending it. It was just sitting in the bank the whole time. So, because I had saved $400 over the course of the year for my Christmas shopping I knew without any uncertainty that I could afford to spend this money on presents for my family. I knew it.
There is really no feeling like spending money with a purpose. You have taken the time to budget your dollars and this creates a real confidence over time that you are controlling your money and not the other way around. This confidence is priceless, I promise.
There is really no feeling like spending money with a purpose
Are You Budgeting Your Spending?
If you are reading this post, I’m guessing that you are not currently budgeting your money. As I said before, there are lots of ways to do this. Frankly, I struggled for a long time before I found anything that really made sense and worked for me and my family. I tried writing everything down in a notebook, using Excel, whatever I could find. I really needed a solution that I could update on the go and that handled all of the math and organization for me. After searching around on the internet for a while I stumbled upon a really neat program and community called YouNeedABudget. It is an extremely powerful solution that works for LOTS of people.
If you want to check out YouNeedABudget(YNAB) I would appreciate it if you could use my link to youneedabudget.com. You will save $6 off the purchase price and I will receive a small commission. Honestly, I ended up paying full price for this program many months back because I didn’t know about the promo code and it has EASILY paid for itself during that time by helping me eliminate late fees and debt. You’ll thank yourself later!
Let us know in the comments whether or not you’re currently budgeting your money, what you use, or any questions you might have about budgeting in general!