One Simple Habit You Need To Help Beat Budget Anxiety : October 2017 Budget Update

one simple habit to beat budget anxiety

YOU HAVE THREE SCOOPS OF ICE-CREAM-WHICH FLAVOUR IS ON THE BOTTOM AND WHICH IS ON THE TOP?

 

Simply believing that everything will work out for the best financially is comparable to telling a child money grows on trees. Near the end of each year I receive emails from fans who complain of budget anxiety for a variety of reasons. I often reply back with making one simple habit change to ease the pain a bit to help them move forward. No, I’m not Doctor Budget but close.

Financial burden placed upon anyone is a weight that you either work hard to build the strength to lift it or will cripple you. Those of you who have been to financial hell and back know exactly what I’m talking about. The journey is never pleasant and comes with a myriad of emotions that can sometimes take over your world.

Controlling anxiety no matter what the cause is and it can be multiple things is not easy to do especially when you don’t know where to begin. One of the best resources for your anxiety is yourself and others who are going through what you are experiencing or have surpassed this with a success story.

Dear Mr. CBB,

My anxiety if out of control when it comes to our finances and budgeting that I’m not sure if I can continue in this relationship any longer. My husband spends money without any care in the world and I just can’t understand why he won’t make simple habit changes for our family.

I have done many things to help us save money even if it’s by using coupons, discount codes, sales and so on but he doesn’t. If he wants it, he gets it. Sometimes I don’t even know when he spends money until after the fact and then I have to deal with paying off the debt without going crazy.

What are some things I can do to calm my budget anxiety down so I can focus on simple present goals for long-term financial success?

Thanks,

Rita

Hi Rita and fellow CBB readers…here’s my answer!

Learning from each other is paramount to financial success but what’s important to remember is that not everyone is successful. Consider going back to basics and start with one simple habit that will be the umbrella in which covers your financial journey.

Consider my ice-cream cone analogy which helps both Mrs. CBB and I to understand the financial revolving door. Most people pick their favourite flavour of ice-cream first when looking at the variety staring at them in the shop window display. This becomes your bottom scoop. By the time you get to the top scoop it becomes settling for your second choices.

In other words it can get a bit boring BUT you’ll eat it anyways because you like what it tastes like. Some people skip variety and all three scoops are the same which can lead to boredom once again. My point is that no matter if your ice-cream cone has 3 scoops of your favourite flavour or your favourite on the bottom eventually you will reach your destination.

Some people are successful with all the same scoops in one cone and others have to work extra hard to reach their bottom goal, the lick of a life-time. That’s what success tastes like when you get to finally taste it.

Whether your favourite scoop is on the bottom or on the top you’ll reach your destination but at different intervals in your life. If you just let it melt or you attack it too slowly you may find that all you have in the end is a sticky mess that you have to clean up. No one likes to tackle debt and to be honest controlling anxiety may take more than one simple habit, it may take a team of them, hence the different flavoured scoops of ice-cream.

 

Changing Habits Changing Lives

 

Long-term success with your money is just as important as achieving short-term goals. In fact those short-term goals WILL lead to your long-term success if you continue to pour the success back into the pot so the money works harder for you. Some people when they reach a goal they STOP. That’s the worst thing you can do.

If you’ve found something that works for you don’t stop doing it just because you feel you have won the battle. No one ever wins with money. I don’t care if you have millions or nothing to rub together. Here’s an example: We became debt free including our mortgage back in May 2014 which most of you regular readers already know.

One might sit back and chill now that the believe they are home free but trust me, you never are. Bills can just as easily pile up when you are debt free especially when you think you can spend freely. Changing our financial habits helped us get to this place and it changed our lives so we need to give back by sticking with what works.

 

Controlling Anxiety with Meditation

 

A 5 minute meditation is all you need to get into the groove with your inner self. I don’t tell many people but maybe today is the time to say that I meditate every night. This not only helps me to be happy everyday it reminds me of how important my health is to my overall success in life. Too often we don’t take a minute to ask ourselves what we need and how to be happy everyday. By focusing on personal needs first the rest will come easier.

 

One Simple Habit

 

One of the worst things you can do is to work on your budget and finances in an unorganized environment. Whether you use the pen and paper method or focus on using technology to manage your money you MUST and I repeat MUST stay organized.

Plenty of budget anxiety comes from not having enough money to get through the month and pay the bills. When you take the time to organize what I like to call a financial book you get a clearer picture.

I have spoken to people who budget half-assed and by that I mean they don’t take it seriously. Your budget will NOT work for you. You have to make it work. This means ensuring that you set a time and day to focus on financial duty, conversations about money with loved ones and working on making life a bit easier for your money.

This simple habit of organization will take you from somewhat understanding to seeing the full picture. From this point you can make informed decisions and take that budget anxiety down a notch. Clearly there are many other ways to help reduce budget anxiety but starting with one of the most important is a valid reason to ask yourself, “Am I really doing all I need to do for our budget?”

If the answer is no then you need to make a plan and revisit it whether it be by yourself or with a partner. If both of you aren’t on the same page financially I can almost guarantee you a life of misery or divorce. You may think I’m being harsh but I’m not. Sometimes telling it like it is can be hard to hear.

You have to move on

In conclusion to Rita and everyone reading today don’t let your financial situation dictate your happiness. Money comes and goes and what you want to focus on is how to make the money stay for a while so it can grow into the money tree that you once believed existed.

Discussion Question: What are some things you do to help control your budget anxiety? Leave a comment below and I’ll respond!

 

Where our money went in October

 

 

October 2017 Month Income and Expenses

Hey everyone,

As you can see our income has dropped this month and that’s due to me quitting my full-time job and now getting paid monthly. This may throw off our figures a bit until we get things under control.

One of our biggest expenses in October has to be our basement renovation and roofing project that we have gifted to our in-laws. You may think that we’ve gone overboard but trust me when I say I’d rather deal with $7000 worth of work rather than $50,000. It’s not easy saying no to the people who loved you and brought you up. This is our way of giving back and taking a bit of the financial worry off their shoulders for the time being since they have been so ill and my father-in-law near death.

Another big expense goes to our little guy and his bedroom renovation. I will likely do a blog post about this because we feel we made plenty of errors along the way as parents and spent far more than we should have for baby and the baby room. More to come but in the meantime we furnished the room to the tune of $1000.

 

Pick a Free budget that’s right for you

 

I’m currently offering 2 versions of our budget and the reason behind it is simple. Firstly, read the CBB blog disclaimer because what you do with it is your own business so if you mess it up you need to sort that out.

I have not closed off any cells so you can make all the changes you like to the budget to reflect your lifestyle which is what you asked me for in your emails. (See I do listen and read your comments and emails)

Although I would love to help every single fan with their budget I am unable to do so but I am always willing to answer any emails you send me so don’t be shy.

This was after all meant to be our personal budget and although I would love to customize it for every fan that wants to use it but, I’m afraid I cannot.

I’m not selling this budget or hope to make any money from it so enjoy this free budget and I hope that it works for you as much as it does for us.

 

Get Our Free Budget Spreadsheet

 

cbb budget screen shot compressed

You can download the free budget spreadsheets here.

  • Budget 1– You can use the pre-existing categories or you can use your own if you wish and you have the option to use projected expenses or not. Please read all notes left around the budget for tips.
  • Budget 2– Everything is pre-set so you have to use the pre-defined categories but this budget will generate year-end budget figures where the other one won’t but you must use the categories already in this budget. If you change anything you will mess up the formulas and year-end figures.
  • Please read all notes left around the budget for tips.

Test the budget for a few months and see how it goes. Trial and error, remember that.

 

Our family budget plan

 

How we budget our monthly expenses?

I often have fans ask me how to budget money on a low-income or they simply have a high debt load and want to kill it like my friend Tony who got rid of over $100,000 worth of debt by using a budget.

CBB fans want to know what we do in order to save so much money and the reply I give is simple>> It’s not about the money it’s about the process involved.

We are both money managers of our finances and with our relationship compatibility we have been able to get to where we are in 2017, debt free.

It doesn’t matter if you are using a cash only budget or you use your debit and credit cards, if your budget doesn’t balance you have budget issues you should check it pronto.

Learning how to be your own money manager is important because no one else will care about your money more than YOU!.

We don’t always save as much money as we would like every month but most importantly we are not going into debt but only because we are budgeting our money. In fact we are currently debt-free including the mortgage which means all we pay for is our monthly bills and expenses.

One of the most important things we did for our personal finances was that we never let the budget deter us from reaching our goals.

Sure we’ve had crap months but we’ve made up for it or we learned from our mistakes just like we should. Budget failure only occurs when you give up on your budget which should not happen as long as you truly want to reach your goals.

We didn’t always earn the income we do today but made do with what we were earning so we didn’t go into debt. That my friends is “living below your means”. The only science to becoming rich!

Sometimes fans email and ask me if living on a budget in Canada is any different from living and budgeting in other countries. To be honest I’m going to say, probably not.

If I still lived in the UK I could use this exact budget spreadsheet to meet all of my needs however the budget needs to be reviewed monthly.

Below are links to the budgeting series which I wrote while designing our excel budget spreadsheet which will give you an idea just how we designed our budget.

I’m not a financial planner/advisor so I can’t tell you how you should budget but I can show you how we budget. I’m just a regular guy just like everyone else; some might call me a budget or numbers nerd.

 

Learn how to budget with Mr.CBB

 

Our Simple Budgeting Series

Do you want to learn to budget like we do?

We explain everything we do and more in this mini-series below all about budgeting.

Please take the time to read through our budgeting series plus read Budgeting in the New Year. I hope the information will help stop you from making common budgeting mistakes that I hear of often and that you take something away from the information and apply it to your financial situation.

If you have any questions about what we do with our budget money tracker feel free to email me.

  1. How We Designed Our Budget Step 1 Gathering All the information
  2. How We Designed Our Budget Step 2Budget Categories
  3. How We Designed Our Budget Step 3– Tracking Receipts
  4. How We Designed Our Budget Step 4- Note-taking
  5. How We Designed Our Budget Step 5– 5S Organization
  6. How We Designed Our Budget Step 6– Who Does What and When?
  7. How We Designed Our Budget Step 7– Balancing Our Budget
  8. How We Designed Our Budget Step 8– Knowing our Coupon Savings
  9. How We Designed Our Budget Step 9– Reading Our Bills
  10. How We Designed Our Budget Step 10 Projected Expenses

 

Budget percentages October 2017

 

October 2017 Household Percentages

Our savings of 24.12% only includes the investments for this month based on the income of $6010.50. Even though we put money away for the projected expenses we were still over budget. The other categories were fairly normal until you get to the Housing Ratio and then due to the basement project the category took 113.73% of our income.

 

Budget percentages month by month

 

October 2017 Month by Month

 

Breaking down expenses

 

This is simply a breakdown of our expenses which has helped us to understand where all of our money goes. Since May 2014 we have been mortgage free so much of our money will be directed at savings, investments and renovations.

I appreciate that you enjoy this budget update each month but I do hope you view this as an educational tool rather than comparing your own financial numbers as our situations are all unique.

Although I encourage your comments and love to hear what you have to say about our budget categories and expenses please don’t tell us to donate our money to charities because we have too much or are fortunate. We are hardly out of the clear with finances for the rest of our lives and have worked and sacrificed to get where we are. We do plan to enjoy the money we’ve saved now since we haven’t over the years with our son.

What we do with our ‘extra cash’ is our business and although we do donate to a charity we won’t be putting it on display for the world to see as it defeats the purpose in my eyes. It is part of the budget as you see it. I hope that clears that up for those of you who had concerns about our extra money.

Just 10 years ago I started working in Canada making a bit over minimum wage and have since moved up the ladder. I’m now working very hard to secure my dream job with one foot in the door. We aren’t all lucky but if you do the best you can at least you can look back and say you gave it a shot.

Sometimes we wish we had more money to budget with but understand that we only have what we earn and if we want more, we need to earn more. Spending less than we earn and budgeting our money has been the easiest way for us to pay down debt and save money.

  1. Chequing– This is the bank account where all of our debt gets paid from.
  2. Emergency Savings Account– This is a high-interest savings account.
  3. Regular Savings Account– This is a savings account that holds our projected expenses.
  4. Monthly Budgeted Total: $5187.39
  5. Monthly Net Income Total$6,010.50
  6. (Check out our Ultimate Grocery Guide to see where our grocery money goes)
  7. Projected Expenses: These are expenses we know we will pay for throughout the year = $1917.68
  8. Total Expenses Actually Paid Out$12,071.11
  9. Total Expenses Actually Paid Out: Calculated is $6,010.50 (total net monthly income) – $1,917.68 (projected expenses) + $7978.29 (emergency savings) = –$12,071.11
  10. Actual Cash Savings going into Emergency Savings: Calculated is $6,010.50 (total monthly net income) – $12,071.11 (actual expenses paid out for the month) – $1917.68 (projected expenses) = $7978.29

 

How to save for future expenses

 

What are Projected Expenses? – We project expenses throughout the year so we have the money saved. PE= A projected expense is money automatically saved each month so it is ready when the bill comes in or when you need it as in the example below.

We review our projected expenses at the beginning of the year to set up our yearly budget and adjust as we go along if a new projected expense arises and needs to be added to the budget. Sometimes we remove a projected expense as well so it’s very important to keep an eye on your expenses.

This has happened on many occasions but it’s bound to happen as we can’t predict everything we have to pay for over the course of the year. The important part for us is that we are saving for these expenses and we no longer have to stress about taking money from our savings to pay for them. To learn more about projected expenses read Step 10 in my budgeting series.

When we spend the money in a projected expense category we move that money to our chequing account in order to pay for that incoming expense. So this means the numbers go up and down in the projected expenses account based on what we need to pay for that we saved for in the account over time.

The only thing you need to do is track your projected expenses each month manually as I can’t customize that for you in the excel budget spreadsheet as I don’t know what you will use for projected expenses.

For now we will have to manually track which means month after month we add up what we save in each projected expense category and minus what we spend so we know how much we have and what is left in each category. I have updated our personal excel budget spreadsheet for 2017.

We pay money into the projected expenses account continually throughout the year even when bills come due as its revolving so as one bill gets paid the money continues to come in from the other categories all year-long. This ensures that money is always available. It may not always be enough but having something ready is better than having nothing at all and having to use credit.

So the $1967.68 gets paid into the projected expense account every month no matter what. It seems to be easier to track our money this way but you can do what works best for you.

 

Example Projected Expense

 

If our clothing category was a projected expense we would have a budget of $50 per month for the two of us. If we spend $30 on clothes for the month that means we need to pull $30 from the projected expenses account to pay for this expense or we move only $20 to projected expenses for the month and leave the $30 in your chequing account.

It’s up to you how you do it as I mentioned above. My plan is to create a projected expenses spreadsheet to track the expenses all year-long otherwise you need to do it manually which we currently do in order to make sure we don’t overspend what we haven’t saved or will save over the course of the year.

It’s a fairly easy process essentially becoming a lifestyle change for your finances but the most important part is that the money is available and saved, which means potentially less stress.

This means we should have $600.00 per year for clothing to spend. We have to track that expense as we spend it manually but hopefully when I find some time I can incorporate that into our budget spreadsheet so it tallies the numbers up as we go along. That way we will be able to know exactly what we’ve spent as an ongoing total.

 

Budget Results

 

Time for the juicy category numbers and to see how we made out with our monthly budget. Below you will see two tables, one is our monthly budget and the other is our actual budget for the month of October 2017. This budget represents 2 adults and a toddler plus our investments.

Budget colour chart

If highlighted in blue that means it is a projected expense. You will also see our budget does not include the emergency savings as it’s factored in at the end.

 

Budget for October 2017

 

September 2017 Monthly Budgeted Amounts-1

 

Actual budget expenses for October 2017

 

October 2017 Actual Monthly Budget

Yep, you’re not seeing the wrong number up there! We spent lots of money in October BUT we were ready for it. You can to if you follow a budget and take your finances to the top of your priority list.

 

November 2017 Goals

 

  • Remove ceiling fan in our sons room that I smashed with the bunk bed and replace it- NEW!
  • Finish insulating the basement- NEW!
  • Set up the Bunk Beds with mattresses, sheet sets and removal wall decals in our sons room- All Done…. finally!
  • Fix the screw holes in our sons bedroom wall- This still needs to get done
  • Start prepping the yard for winter.- This is done
  • Get rid of more stuff in the house either donate it or sell it- This is still in progress and lots has been done.
  • Order roofing materials for a surprise November roof installation- This is done and getting installed this weekend
  • Sell our second vehicle after I repair a few bits- I have yet to complete this
  • Finish painting a lovely wood cabinet I picked up free from Kijiji- We have no room for this right now. I still need to add one more coat and it will be finished. It’s in our garage at the moment.
  • Review our Christmas Budget- Working on this in November

 

Budget updates month by month

 

In case you missed our budget updates and want to do a quick search I’ve compiled them all on one handy page: monthly budgets. For the 2017 Year I will also keep track of each month below and update the monthly budgets page.

That’s all for this month check back at the beginning of December 2017 to see how we made out with our November 2017 budget.

Happy Budgeting CBB’ers!

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Mr. CBB
Mr. CBB was born and raised in the United Kingdom who then moved to Canada where he is a permanent resident. He recently became a father to a very busy toddler who allows him to be a kid at heart. He bought his first house at the age of 21 after University and his second at the age of 24. Both Mr.CBB and his wife are Debt and Mortgage Free and they did it all in under 5 years using a Budget. Canadian Budget Binder is a place where he shares their financial experiences with his readers and hopes to learn about theirs. Welcome to CBB!
Mr. CBB
Mr. CBB

Comments

  1. Anne Russell says:

    I get budget anxiety from other people’s budget woes! I’m doing well with our own, making steady progress. Im reaching pur long and short term goals. I am the money shepherd.
    Others I know have what I perceive as difficulty in managing. They make 2.5 times our monthly income, pay less in rent, have 2 not five to feed. And they didn’t make rent last month by a few hundred. I try to encourage them by telling my strategies and and asking about their goals, but I get an abrupt “I know how to budget.”
    I see so many wasted opportunities but I came our relationship so I’ll back off.
    Anyone?

    • Yes you’re right which is why I push “It’s not about how much money you make it’s how you save it”. If more people thought like you they’d be in less financial distress. Well done Anne.

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