If your New Year’s resolve to conquer debt, now is the time to prepare by collecting your financial tools for Jan 1.
So today, I wanted to talk about how our budgeting journey has evolved.
Get Organized With 8 Financial Tools
You need a budget to overcome and control your money and debts, but you’ll learn more about that below.
I know some of you might despise using a budget, although I hope I can change your mind like it has changed our lives.
For those who budget in your heads, I urge you to forget that budgeting method and get honest with numbers and facts.
There was a time when Mrs. CBB and I did the same thing with no budget, and I can look back and know that was a terrible mistake.
One weekend in December 2009, we asked each other about our New Years’ resolution.
I was shocked that she wanted to understand more about our finances to pay off debt quickly and buy a home.
Humble Budgeting Tools And Beginnings
To get a start in Canada, or you’re a permanent resident as I am, you take what you can get, even accommodations.
I was fortunate that Mrs. CBB already had a place to live, and the landlord allowed me to stay for an extra $100 a month.
At the time, we were living in a basement dungeon with kids upstairs in their teens.
You can imagine the success we went through and missing items from our bedroom because there was no door, just a shutter.
I took a trip to the restore and purchased a door and lock, followed by installing it.
We almost felt violated knowing the kids and our landlord could come in and look around without notice.
Honestly, there was nothing to worry about because keeping a bedroom clean is not hard.
This is where the budget idea started, but it didn’t become a reality until we moved out.
We had enough of the arguments upstairs and just got to the point we knew we needed out.
House Hunting and Financial Tools To Help You
Quietly we started looking at houses using only one of our incomes to play it safe.
Our budget was between 200K to 275k, and after house hunting, we finally found the home we are in now.
We paid $265k for our home, a fantastic deal in 2009 when house prices plummeted.
Today our house would sell for over $800k just as it is, so I’m renovating it to increase its value.
Moving To Canada Was Like learning to crawl again
I had to study the coins and bills in Canada because I didn’t even understand them.
So, for all we went through moving me to Canada with my dog, learning about Canada, education, and credits from my degree were overwhelming.
Eventually, I went to the local college and signed up for a program where I earned top marks and a new career path.
I started at $15 an hour and now earn almost five times that amount because I had confidence in my skills and wanted a higher income.
With all of that going on, we continued to create a basic budget on paper and kept it in a 3-ring binder.
All I can tell you is that the start of our financial journey did not stay the same.
Finance Tools Have Evolved
We’ve evolved from a basic budget to a spreadsheet I created, and I couldn’t be happier.
I created two excel budget versions for my subscribers.
However, I urge you to try the different types of options for budgeting to see what fits right in your life.
- Cash Budget
- Using Jars for budgeting
- Excel Spreadsheet
- Bare Bones Budget (free printable)
- The 50/20/30 budget
- A budget spreadsheet where the users can change things around
- The user must use the budget as most people do, as it’s quite detailed.
Then in 2012, Canadian Budget Binder was born, and we’ve since learned much about budgeting.
I urge anyone who uses a budget not to give up, even if you have more debt than the income coming in.
I wanted this post to be essential for newbies to budgeting so you could get your financial tools ready if you’re serious about budgeting.
Your Financial Tools In A Binder Or File Binder
A budget is your financial bible, where you can slash budget categories and plan your journey.
The budget we have for free on the blog not only helped us save money and pay off debt but also allowed us to save and buy a house.
Using the same budget in five years, we had become mortgage-free, which was a financial victory for us.
I want to share with you the financial tools we use when budgeting in the CBB house.
Quiet Home Office Space
The quiet home office space where you can organize your financial tools is imperative.
If you don’t have an office, find a quiet place in your house where your computer, laptop, or other devices are needed.
I have a home office in the basement where I do all my work because when our son is home, he always wants my attention.
When work is over then we play and besides trying to focus with people talking is annoying.
Your office should embrace a positive environment to keep you motivated.
Overdraft Protection Is Part Of Financial Tools To Have
It costs you nothing unless you need to use it; however, it is always great if something happens.
We found out that you don’t want to use an overdraft to buy Christmas presents, furniture, etc.
If you use it, make sure it’s for an emergency. If you have nothing saved, you can pay it back promptly.
Overdraft protection helps cover occasional shortfalls in your chequing account, up to your approved overdraft limit even if you have insufficient funds in the account. It helps you manage your finances by allowing you to complete a transaction. – TD Canada Trust
Do you need overdraft protection?
A while back, we had overdraft protection until we added each other’s names to our bank account.
We did this if one of us passed away so the bank accounts wouldn’t be frozen.
During that time, we didn’t move enough money to our chequing account for our bills and found no overdraft.
When we added our names to each other’s bank account the overdraft was not discussed.
There are several benefits to having overdraft protection:
- Helps cover unexpected cash shortfalls by providing automatic protection against declined transactions.
- Prevents Non-Sufficient Funds (NSF) charges from occurring. – TD Canada Trust.
Budgeting Rules and Goals
This may sound odd to some couples but we have budgeting rules and goals that we created for ourselves.
Here’s an example;
- Who double-checks the receipts?
- Don’t forget to always ask for a receipt (both of us)
- If you see coupons, don’t walk by them without reading them.
- Read the receipt before you leave to make sure the prices are correct.
- Always use cashback apps where possible and a rewards card for points.
- Come up with a plan to see who does what when budgeting.
- Discuss why you are budgeting and the steps involved with budgeting.
Budget Spreadsheet or Basic Budget
Like I’ve mentioned, you need to find a budget or budget app that fits your needs.
You can stop and start another budget until you find one that resonates with your goals.
Not everyone is efficient with excel so perhaps look for a printable budget or budget app.
For subscribers, you can find my Free Finance Tools Here.
Don’t try and budget in your head because mistakes can happen and mess up your monthly budget.
Mrs. CBB and I use a calculator or we use the calculator on our smartphones.
Either way is acceptable as long as you keep a calculator handy.
As well if you’re using a tabled, desktop computer or laptop they all will have calculators.
Pens, Pencils, and Pens
Stock your quiet office space or room with pens, pencils, and erasers which always come in handy.
I’d also consider having a backup USB for your essential documents and a photocopier.
You find photocopiers at Walmart for dirt cheap and I bet there will some after Christmas Deals on Boxing Day.
We have one notebook where we scribble numbers and make notes about our budget.
There’s a point where you must evaluate your budget to see if it’s working for you.
Perhaps you want to move to a different budget or switch up the budget to personalize it better.
After all of the years of blogging at Canadian Budget Binder, what I tried to do the most was to motivate people to create a budget.
I even went as far as doing quite a bit of work to design excel budget spreadsheets to further motivate people.
You’ll succeed if you have positive people in your life and believe in yourself through the good times and bad.
There are undoubtedly other financial tools you could add to my list, but these, I feel, are the bare essentials for someone new to budgeting.
You will only get out what you put in and remember why you started the journey in the first place.
Create a goals list at the start of the year and revisit it to see how well you keep up with your debt-free dreams.
Discussion: When did you start using a budget and why?
Leave me your comments below, and I’ll respond to them all.