When I think of budgeting, I am reminded of what Elizabeth George wrote in Putting on a Quiet and Gentle Spirit about learning to read the Bible:
There is the cod liver oil stage when you take it like medicine; the shredded wheat stage when it’s nourishing but dry; and the peaches and cream stage when it is consumed with passion and pleasure.
That quote has stayed with me, especially because I felt that way almost my entire life.
I was a cod liver oil gal for sure—Why in the world would anyone read the Bible?!?—and then, less than ten years ago, I was introduced to the beauty and blessing of having a relationship with Christ.
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My world was forever rocked.
Now I’m a peaches and cream girl. 🙂
I realized that my hubby and I followed that same thought process with our finances.
We knew budgeting existed, but what a bothersome thing to do.
Why, it would be like taking cod liver oil when we were FINE.
*Shudder*
What would be the point?
The point is that budgeting is either tasty preventative medicine to help you become even more financially healthy or a welcome and necessary cure to help you back up onto your feet.
The truth is that about 7 out of 10 Americans are living paycheck to paycheck.
According to an article on CNN Money:
Roughly three-quarters of Americans are living paycheck-to-paycheck, with little to no emergency savings, according to a survey released by Bankrate.com Monday.
. . . online lender CashNetUSA said 22% of the 1,000 people it recently surveyed had less than $100 in savings to cover an emergency, while 46% had less than $800. After paying debts and taking care of housing, car and child care-related expenses, the respondents said there just isn’t enough money left over for saving more.
Living on that edge means one event can push you over the cliff, and the odds of you going over are much higher than you can imagine.
Budgeting helps you avoid that steep and painful fall.
I have put together ten tips to help change your perspective so you can become a peaches and cream budgeter, too.
1. Accept that in the beginning it may taste like cod liver oil. Yes, putting ALL your debts, expenses, and income on paper is painful, but it’s far better than continuing to live in ignorance. Been there, done that. Trust me on this, and please, just take this step. Dustin has a great how-to on the basics, and more on why to budget here.
2. Understand where you are is not forever. Putting those figures down doesn’t condemn you to that place for your life. It’s just a financial GPS so you can see where you are right now.
3. Realize that once you have your bearings, you can plot your journey forward. You will never be able to move to where you want to be unless you figure out where you are.
4. Know that you will mess up. Yes, failure is an option and an integral part of the learning process. It’s like piloting a ship to a distant port. The craft can’t travel in an absolutely straight line. The captain doesn’t throw up his hands in anger and irritation every time he goes off-course. He just adjusts direction as needed.
5. See budgeting as freedom. Yes, sweet, sweet freedom! You may believe as we did that budgeting meant we’d never have fun again. EVER. But, like the optical illusion below, what we saw depended completely on our perspective. Duck or bunny? Chains or freedom? Once we realized the budget was our opportunity to choose intentionally where each dollar went, we saw the freedom we could have from guilt, worry, and fear.
6. Embrace the hope that follows budgeting. We have seen hope bloom in folks my husband and I have helped with getting their finances in order, and we felt it ourselves. I can’t explain it. I can tell you there is a mental load you are carrying you probably don’t even know is weighing you down. Once you begin budgeting, you will be surprised at how much more hopeful you feel.
7. Enjoy greater confidence in handling financial emergencies. Our youngest daughter and her boyfriend decided to surprise us at Christmas by driving nearly non-stop from Montana to New Hampshire. The 2,500 miles were not without excitement. They hit a deer, which ripped off the right side of their bumper. They drove over two big potholes in the middle of the night, which flattened a tire and bent a rim. The service that came to help backed into their car and put a hole in what was left of the bumper. The intrepid travelers had to rent a car to finish the distance from western NY to NH, and back again. Needles to say this was costly, but they handled it all in stride.
8. Find a method to make it easy and convenient. Find a way that works for you, whether it’s on paper or in the computer. The longer you create budgets, the easier it becomes, and the more you can see the distance you have covered. That makes life go down so much more sweetly!
9. Use the power of the Wow! Factor. It’s about figuring out the opportunity costs, determining what you truly value, and what really fits you and your family today. Integrating these areas brings lots of joy and satisfaction to the process and follow-through.
10. Remember that budgeting is a tool. It is a means to an end to help you to achieve a goal, like a car gets you to work. Just. A. Tool. When you realize this, you can let go of the negative emotions attached to budgeting.
Everyone has problems, and if you try to run away from them they tend to eventually run you over. Instead, embrace them and learn what you can. It is often the most difficult times that grow you the most, but are also the most gratifying.
Solving problems, whether after the fact or preemptively, is a task for which budgeting is wonderfully suited.
Now go create your budget so you can change your life for the better!
Question: Where are you in the budgeting process? Cod liver oil stage? Peaches and cream? Please share in the comments so we can help one another!
Original image credit: Alan Cleaver
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Great practical advice on developing the right mindset with regard to budgeting. My wife and I have been working on finding that sweet spot where we’re able to focus on the areas of our budget that make the most impact. For us, we’ve found it’s better to pay close attention to a few critical categories of spending rather than be overwhelmed (and soon burned out) by trying to track every penny we spend.
We’ve found that budgeting is a skill that we can develop and improve. As we both communicate and get better at making wise spending decisions, the less trauma we experience with our finances. We still make mistakes, but we’re on the right track.
Thanks for sharing what has worked for you, David. You are right-there is no one perfect way to budget. I like the idea of the “sweet spot”where you get the most bang for your budgeting buck!
When we got married, we lived paycheck to paycheck, didn’t want to budget, and our finances were a disaster. A few years ago, we decided we needed to change or we were going to go bankrupt. So we did a massive self assessment of the situation, drew up a week by week budget for every dollar in and out for the next year.
Now I love budgeting. I look forward to creating my yearly budget. I like sitting done every week and tracking our cashflow against our budget. Its like a game where we always win, instead of always lose.
Well said! I love the analogy of budgeting being a game you always win. 🙂
Sounds like you are truly a peaches & cream budgeter!