May 8, 2016
The fight for financial freedom is long and challenging and encouraging and rewarding and all of the things and feelings kneaded into one. From the moment I began the Dave Ramsey approach to finding financial freedom, my world drastically changed. I went from swiping all of the credit cards all of the time to living by a strict spreadsheet and divvying cash into little envelopes. I've been on this journey for a year and a half and as each month passes, I find myself learning new lessons all the time. Here are a few of my most recent aha moments:
1. You will still live paycheck-to-paycheck.
We've all heard (or lived) the phrase "living paycheck-to-paycheck." For me it used to mean a little something different than it does now. It meant hardly ever looking at my checking account as I swiped that debit card left and right, only to wind up crying in my car later when I realized I was down to $14 on the 6th day of the month when I had just been paid on the 1st of the month AND I was only being paid once a month (an excessive amount of the use of the word "month," but it is what it is). That's what we call rock bottom, folks. Living paycheck-to-paycheck, then, meant praying that my landlord would just happen to wait one more day to cash that rent check so that my account wouldn't be overdrawn, or hoping that my tank of gas would carry me into the next week. It was stressful and constantly terrifying. And embarrassing.
But now, I'm still living paycheck-to-paycheck - just in a much healthier way. Now it is in a way that means I've budgeted out every single dollar that I receive each pay period. I know exactly where those dollars will be going and there are no surprises along the way (and hey - if there is a surprise...like your car being flooded...again...the emergency fund comes to the rescue). No more looking at my account wondering where in the world my money was disappearing to. No more crying - but instead living life within boundaries that create a significant amount of freedom.
2. Practice and preparation make perfect.
When I first started budgeting out my months I found it a little daunting. Planning out my money for an entire 30 days was overwhelming for someone that could hardly plan out money for one week. Also, I'd find myself forgetting about activities that I had planned or the fact that Father's Day was in that month or whatever. Eventually, though, this became easier the more I did it. Now, as the beginning of the next month approaches, I sit down with my calendar and plan out my budget. I do my best to take into account every holiday, birthday, and social activity along with my usual bill planning. This step of preparation makes budgeting worlds easier. It definitely took some time and guidance to get the hang of it, but eventually it feels nothing but natural.
The things that have been the hardest for me to successfully budget for have been trips and vacations because many times there are activities that are thrown in that won't be accounted for until later. Again, the more you do this, though, the easier it gets, and until you can nail the exact cost that the trip will be, the best thing to do is over-budget. It will be way better to come home with money than run out of money halfway through. To this day, my best budgeting trip was this January for a bachelorette party weekend in New Orleans. I shopped all the shops, ate all of the macaroons, drank all of the coffee (and maybe some wine), and still came home with $2 in my envelope. We call that a hashtag success.
3. Budgeted spending is the most freeing and rewarding spending.
In the short year and a half since I've been on the Dave Ramsey train, I've had to say "no" to more than one trip with friends. Saying no has never been easy for me. For 27 years of my life I was a constant "yes" girl. (And not just "yes," but more like "YAAAAS!") I never wanted to miss out on anything (we call this FOMO - the fear of missing out) and I hate to not be included. That's changed in the last 18 months and it's taken quite a bit of patience and perseverance (and coaching from Loni, my finance/life/girl boss/friend mentor). If I could, I'd still be saying "YAAAAS" all of the time, but the fact of the matter is that I just can't. However, now, when I do say "YAAAAS," the experiences are that much sweeter.
When I have planned, prepped, and saved for a trip, I am able to walk into it completely guilt-free, with no worries on how I'm going to find the money to cover this credit card bill or where I'm going to have to cut corners somewhere else to make up for it. It is incredibly freeing and rewarding, and makes me sad that I hadn't been living life this way the whole time.
People often think that putting their lives into a budget will feel constricting and limiting, but it's actually quite the opposite. Again, take it from the girl that had so little control of her spending habits that she had dwindled her checking account to $14 with 25 days left in the pay period. That same girl is now not only able to reasonably spend money on things she wants to spend them on, but is also able to throw hundreds of dollars at debt every single month. Never in my wildest dreams did I imagine that it could all be possible. And if I can do it - so can you. Please never hesitate to reach out if you have questions or are ready to begin your own journey toward financial freedom!