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Money Management

Living Your Best Life on a Budget

Living Your Best Life on a Budget

This post may contain affiliate links. Check out my Disclosure Policy for more information.

The first thing everyone thinks when they hear budget is being restricted. I know for myself at 22 when I thought about creating a budget I thought I’d never get to do anything, since I’d be on a budget.

The reality is that this just isn’t the case. Budgeting is simply managing your money, it doesn’t mean you need to hole yourself up at home! Your budget will set you free to spend your money because you will know exactly where your money is going.

By following these steps, you will find ways to also live your best life while still keeping to your budget. If you need help setting up your budget, I have a template you can use!

1. Determine what you value.

I am a firm believer in spending money on the things that you value. Track your spending for a month and see where your money is going. Which purchases were needs and which were wants. From your wants, what do you truly value, what brings joy to your life.

This is obviously different for everyone! Whatever it is that brings you joy, make sure you include that in your budget. The things that you could go without, cut that expense from your budget.

This doesn’t need to be extreme at the beginning. I honestly recommend not cutting much out in the beginning of budgeting because you will feel restricted, when that isn’t what budgeting is. Cut things that annoy you. I remember when I saw all my expenses the first time I realized the absurd amount of money I spent at Chipotle.

Of course, I didn’t cut Chipotle from my budget, I just cut back in how frequently I went. At the time I was a full time grad student and woking full time. Once a month I worked from 8:00-3:00 and then had back to back classes from 4-10. These were the days I treated myself to Chipotle.

Now I simply have a restaurants line in my budget that I use however I want. I found a balance of what I feel comfortable with after a few months of budget, and you will find that balance as well.

2. Find ways to lower your necessary expenses.

Of course there are things that you just can’t cut from your budget, housing, groceries, utilities, etc. These are necessary expenses and they are going to be a part of your budget, but you should find ways to lower them.

For example, I moved back home with my parents after graduating to cut a major expense when I really didn’t have money to afford moving out. Another great way to lower your expenses is to pay off your debt. Of course this is going to take time, but ultimately it will get rid of a necessary expense in your budget once it is gone. You can use this free awesome tool that helps you calculate your debt payoff date to help motivate you.

Another way to lower your expenses and pay off your debt faster is to refinance your student loans for a lower interest rate. I refinanced mine with Earnest to get a 2% lower rate and you can too, and get $200 when you refinance with my referral link!

The best part about lowering the necessary expenses you have is that these expenses are typically the higher ones. For example, if you can lower or eliminate your housing expenses, it’s going to make your money go so much further for you.

3. Tweak your budget every month.

After you complete a month on your budget you need to reflect on how that month went. Did you feel restricted? What made you feel restricted? What brought you joy this month?

By reflecting on your budget it will allow you to spend money where you want to spend it. For example, going out with my friends for happy hour on Fridays is something that I enjoy a lot. I plan for it and make sure it is in my budget every month.

Something that I don’t enjoy as much is going out for lunch and dinner during the week. For one thing, I don’t have time for it, so I don’t budget for it.

Find the things you love and include them in your budget. A budget is meant to give you permission to spend, but spend on the things you value. When we waste money on the things that don’t bring us joy, we are simply throwing money away. How do you budget for your best life? 

Money Management

How to Zero Based Budget

How to Zero Based BudgetThis post may contain affiliate links. Check out my Disclosure Policy for more information.

Creating a budget can be a daunting task and I know that it prevents a lot of people from taking control of their finances. But it doesn’t have to be! I promise that creating a budget seems like a hard task to complete, but once it is done, it is easy to maintain.

From conversations that I have had, it seems to be that people are scared of implementing a zero based budget. Creating a budget is one thing, but a zero based budget is intimidating to so many more. I was terrified to implement one at first myself. What if I overdraft? What if I mess up the math? There are so many what if’s, but a zero based budget was the game changer in paying off $105k in 3 years for me. Of course, side hustles and refinancing (use my referral link to get $200 when you refinance!) helped, too.

At first, I had this crazy system for budgeting that would take me so long to do every month. It was too much. I eventually stopped using it and wasn’t really budgeting at all, just cutting my expenses and kind of tracking it in Mint.

This worked, but it wasn’t as powerful as creating a zero based budget that doesn’t involve hours of my life. I now know that I need something simple and easy to maintain, or I just won’t use it. This is the system I created for myself to easily  maintain a zero based budget.

Step #1: Create a buffer before you create a zero based budget.

This is critical to implementing a zero based budget and if you don’t do it, you will run the risk of over drafting on your account, like I did when I got a little too confident. You need to determine what you need to feel comfortable with your zero based budget, some people need a month worth of expenses to feel comfortable, some people need $500. It all depends on what you need to feel confident in your system.

It also depends on your income and if it is consistent or inconsistent. If your income is consistent every month, or part of it is, then you might feel comfortable with less of a buffer. If your income is inconsistent, then I would recommend that you have at least 1 month of expenses as a buffer, if not more.

This might seem counter productive to have money just sitting in your account, but by having the buffer, it will allow you to easily implement your zero based budget. It gives you the peace of mind to zero out your budget every single time without thinking twice. If you don’t have the buffer, you will find yourself questioning your math and your budget every single month. This allows your zero based budget to run more smoothly.

Step #2: Create your zero based budget.

This is my favorite part when I first start working with clients. Everyone’s situation is difference, but a simple template can work for everyone. At the most basic level, a budget should have a spot for you to track your income and expenses. That is the most important aspects to any budget. If you subscribe to my newsletter, you will get a free budget template and expense tracker! Based on your pay periods and what works best for you, you will need to create your weekly, pay period, or monthly budget. I personally use a monthly budget. I now have my Google sheets budget template available for you to use!

The only difference from a budget to a zero based budget is that at the end of your budgeting period, you will have zero dollars remaining, or your income and expenses will be the same amount. The key with a zero based budget is that you are telling every penny where to go. This includes savings, paying off debt, or building sinking funds. This doesn’t mean that you are frivolously spending every penny.

Step #3: Implement your zero based budget.

Once you have created your budget, it’s time to implement it. I still use Mint to track my expenses because I use credit cards to earn cash back and other rewards. I only recommend this if you know you will pay your card off in full each month and never carry a balance, otherwise you should just stick to cash or a debit card. By tracking my expenses in Mint, it makes my zero based budget easier to maintain.

Every Sunday I quickly update my budget with my expenses from the week. This means that I subtract any expenses I had in whatever category that they are from. For example, I budget $250 for gas every month and I typically fill up once a week. On Sunday, I subtract that number from my budgeted amount to see what the difference is. This allows me to see exactly how much I have left for the rest of the month. I do this for every category that I had any expenses in for that week.

Step #4: End of the budget with a zero based budget.

At the end of every month I zero out my budget. The reason you need to do this is because you may have not spent all of your money in a certain category and you need to determine what to do with that left over money. If you don’t, that money will just sit in your account and will get “lost.”

There are many things you can do with leftover money at the end of the month, it really depends on where you are in your financial journey. If you are paying off debt, you might make an extra payment. If you know you are going to need more money in a certain category the following month, you might roll that money over. If you are saving for something specific, you might put that extra money towards your savings goal. If you are investing for your future, you might throw that money in an investment account.

The point is that you need to zero out your budget at the end of the month and determine what to do with any leftover money that you didn’t spend, if there is any. I always have money leftover because I would rather budget more and have leftover, then not budget enough and be scrambling to find the money.

Even though I am focusing on paying off my debt right now, my monthly budgeted debt payment isn’t very large because it is based on just my salary and I have other expenses. At the end of the month, I zero out my budget and determine my extra debt payment based on leftover money and money I earned from my side jobs.

Step #5: Readjust and repeat.

Once you have created your zero based budget, it can usually be re-used again and again. Of course, you need to adjust for certain things, every month is going to be slightly different. However, the overall bones of your budget you should be able to reuse. This allows you to save time once the budget is created, you just need to adjust each month and then take the steps to maintain it.

Remember: A budget isn’t made to restrict you, but to empower you.

Your budget is meant to give you the power over your money and where it goes. Determine what you value and what your financial goals are and budget your money to fulfill them. It takes time to figure out budgeting and get into the routine, but once you see your habits changing and the system working, you will feel empowered by your budget. How has a zero based budget changed your finances?

Money Management

Why You Need to Start Cash Flowing

Why You Need to Start Cash Flowing

There are so many terms when it comes to personal finance and so many ways of doing things out there. I mean with a simple search on the Internet you will find endless resources for personal finance and how to go about getting your finances together. The most important is absolutely getting a budget together, cutting expenses, and increasing your income, but it’s also super important to create sinking funds and cash flowing larger expenses.

What is Cash Flowing?

This is one of those terms that is thrown around the personal finance world a lot and it makes sense, it’s super important. Cash flowing is when you have a larger expense and you delay the purchase until you have enough cash saved up for the expense. This tool is used when it is something you didn’t necessarily see coming (unlike a sinking fund that is for known expenses in the future). For example, I am cash flowing a new to me car instead of financing it. Of course, I could go out right now and get a car and finance it, but that would increase my debt. Something I am not interested in doing because I want to live a life of financial independence.

How to Start Cash Flowing.

You’re obviously not going to always use cash flowing, there is a time and a place. If it is a known expense that is happening in the future, like an oil change or yearly membership fee, you should have a sinking fund for it. If it’s something that you need to purchase and have time to save, then cash flow it. I’ll use my example of a new to me car. This isn’t an emergency and I have time to save for it. So, I’m adding money each month to a car fund I created. You need to decide where your priorities are and how quickly you want to cash flow the purchase. For me, I want to have it cash flowed by October, so I am sending a lot of my extra income from side hustles to this fund each month while still sending extra to my debts. Once you have made your decision, you can tweak your budget to find the cash for your purchase. Remember, a budget is not meant to restrict you, but to allow you to make the purchases you want.

Cash flowing has been a total game changer for me and my budget. Just by delaying a purchase until you have the cash to afford it, you can avoid putting yourself into debt. As I said earlier in this post, in order to obtain financial freedom, you can’t be burdened by debt and having to pay companies for past purchases with interest. Have you ever cash flowed a purchase?

Debt

Mini Series Part 4: How to Tackle Your Student Loans

This post may contain affiliate links. Check out my Disclosure Policy for more information.

In this four part mini series you will find all the tips to tackle your student loans regardless of where you are in the process. Student loans affect almost everyone now, which is a very sad reality. From the time a person graduates high school, it’s usually an issue in their life. So, I’m starting this mini series with tips for before you go to college and ending it with tips for after you graduate and have entered repayment.

Mini Series Part 1: Before You Go to College

Mini Series Part 2: While You’re in School

Mini Series Part 3: Before You Graduate

Student Loans Part 4

You’ve crossed the stage, you’ve started in your very first job, and you live in your very first apartment. Everything is falling into place, like it is supposed to after graduation. Now you need to start getting serious about where all of this new money is going that you now have and how you’re going to go about your student loans based on the work you put in for them before you graduated.

  1. Finalize that budget that you drafted before you graduated.

Before you graduated you drafted a budget based on what you thought your income would be and your expenses. Well, now it is time to finalize it. You should know by now how much you will be making monthly, how much your expenses will be, and how much your student loan minimum will be each month. Once you know for sure where your money is going each month, then you can see where you can cut things out. For example, I realized I was spending about $250 each month on eating out when I first tracked my spending. That was a huge reality check for me. This is going to take some time and don’t think you’re going to have your budget set right away. Take the time to make it work for you and don’t rush the process.

2. Save a small emergency fund.

This needs to be a personal choice for you and what you are comfortable with having in case something comes up. I personally have about a month of expenses in a savings account I don’t touch, unless an emergency comes up that I need to use it for. An emergency would be something you can’t plan for, like your car dying. It’s not meant for regular budgeted items, like clothes or food. If you want to go shopping or eat out, put it in your budget!

3. Create a payoff plan for your student loans.

Creating a payoff plan for your student loans is super important to getting them gone ASAP. Without a plan, you won’t know what to prioritize or what you need to do. I personally use undebt.it to plan my debt payoff. It’s wonderful, and allows you to pick what strategy you want to use. It even tells you how each plan will change your debt free date. The things you will need to do this is to have your individual account details (amount, interest rate, minimum, etc.), and know how much extra you can put towards your debt realistically based on your budget.

4. Adjust as life changes.

The most important part of a budget is to constantly adjust it as your life and priorities change. Your budget should change as your life changes. This allows you to be in control of your money versus your money being in control of you. In the beginning, it definitely feels like your money controls you because you’re probably sending a lot of money to your lenders. I know for me, most of my income went to my debt minimums when I first graduated and it was hard. But, I knew as I paid off more, the control would come back to me.

As you continue post grad, it will get easier as you get more comfortable with the process. No matter your circumstances after graduation, there are options to make things easier for you financially. There is never a one size fits all when it comes to finances and ultimately you need to make your decisions personal. With that being said, if you have any questions about getting your budget together or creating a plan to pay off debt, feel free to email me with any and all questions! How did you tackle your student loans after graduation?

Debt

Mini Series Part 1: How to Tackle Your Student Loans

In this four part mini series you will find all the tips to tackle your student loans regardless of where you are in the process. Student loans affect almost everyone now, which is a very sad reality. From the time a person graduates high school, it’s usually an issue in their life. So, I’m starting this mini series with tips for before you go to college and ending it with tips for after you graduate and have entered repayment.

Mini Series Part 2: While You’re in School

Mini Series Part 3: Before You Graduate

Mini Series Part 4: After You Graduate

Mini Series Part 1_ How to Tackle Your Student Loans
Before I went to college, I had no idea I would end up having roughly $200k in student loans 5 years and 2 degrees later. My parents always told me that I would need to take out some loans, but they were going to able to help me with school. Unfortunately, they couldn’t help me with school as much as I thought. I’m not saying I expected my degrees to be paid for by my parents, I never once expected them to give me a dime, until they told me they would. Here are a few things I wish I had known and done before I began my higher education and student loan journey.

1. Know your financial situation completely

This is the biggest one for me. I did not fully know my parents financial situation and didn’t ask for details about what it meant for them to help with school. Unfortunately, I did not get much financial aid because the FAFSA is filed based on your parents income and finances, not mine. This is why it is so important to understand how your education will be paid for. Don’t do what I did and not ask questions. Be specific with your parents about how this is getting paid for. This is a HUGE financial decision and since it’s all based on your parents finances (usually), it’s important to understand how it will be paid for.

2. Seek out advice on filling out the FAFSA

Usually your high school has someone to talk to about filling out the form, but it is best to talk to an expert on how to fill the form out. It’s a pretty straight forward form, but there’s some things they don’t need to know and other things they absolutely need to know. My best advice is to seek out an expert on what the form absolutely needs to have on it because it determines how much financial aid you are going to get. Unfortunately, my mom took responsibility for all of this for me, which at the time was wonderful for me, I didn’t need to deal with it. But once my sister and I received practically no financial aid, we talked to an expert. He quickly told us we provided a lot of unnecessary information, which made our financial situation look very different from what it actually was.

3. Choose your university wisely

If I could go back to when I was applying to colleges, and knew what I know now, I might not have picked the university I went to. It’s very hard to say that after the amazing program I went through. However, it was incredibly expensive and far from home. I could have gone to a closer university and commuted, saving me a lot of money. Of course, I went to a university that has the #1 program for teaching, so would I have landed a teaching job so quickly after graduation had I not done the program, that’s the tricky part. You will never know what will happen in the future, but my advice to you is to avoid having to go into a ton of debt, like I’m currently in.

4. Apply to every scholarship you can find

I made the mistake of not applying to a lot of scholarships because I thought I had no chance of getting it. What I have learned since then is that some scholarships aren’t given out because no one applied to them. That could have been money for my college education. I learned in grad school that you NEED to tell people your situation in order to get the help you need. In our society people don’t talk about their debt or financial situation, but that’s exactly what you need to do. Once I confided in the grad recruiter that I was drowning in debt, she called the right people and within a week I had an email saying I earned a scholarship. Of course, I had done a lot of work for my school in undergrad and my grad studies at that point, which definitely paid off.

5. Take out the maximum amount of federal loans you can before private

Federal and private loans are very different. Federal loans have some loan forgiveness programs, usually lower interest rates and offer a bunch of options for repayment. Private loans have no forgiveness options usually, limited or no payment options, and usually very high interest rates. Stick with federal loans if you can, you’ll be happy you did when repayment time comes along!

The next part of this mini series will explain some tips for when you’re in school. What are some tips you have for tackling student loans before you start school?

Saving Money

Frugal Date Ideas

Frugal Date Ideas

As a twenty something it can be a bit challenging to be on a debt free journey because most twenty somethings aren’t doing anything like this. Most are out exploring new cities, traveling the world, and trying out the newest restaurants. And I’m not saying you shouldn’t do these things because I have totally done this by putting it into the budget or cash flowing a frugal vacation. A really tough area in the budget is finding date ideas that aren’t going to break the budget. I know I struggle with this a lot and I feel like I finally have a handle on ways to enjoy date night without completely blowing the budget.

Frugal Date Idea #1 Go For a Hike

I love being outside and I love being active. One of my favorite date ideas is going hiking because it’s free other than gas and it’s great exercise. I always pack a backpack before heading out with snacks and drinks so we aren’t tempted to buy anything.

Frugal Date Idea #2 Movie Night

It’s so much fun to go to the movies, but sooo expensive. I can’t believe how much they charge at the movies now, it’s absolutely mind blowing. But, it is fun watching the new movies. Of course, you won’t get to see movies as soon as they come out, but having a movie night at home can be super enjoyable. Make lots of popcorn, get drinks ready, and enjoy a great movie together. Even better, you can wear pajamas! 🙂

Frugal Date Idea #3 Cook Dinner Together

Of course it’s always enjoyable to go out to eat, but it can very quickly become expensive for just one meal. It’s so much cheaper to cook a meal at home and enjoy it together. This way you can control the cost based on your budget and control the ingredients. This makes it better for your budget and your health.

Frugal Date Idea #4 Go to the Beach

This can get expensive if you don’t prepare properly. But, pack a cooler full of food, snacks, and drinks and that should make it much more affordable. Also, parking can be very expensive, but if you park a little further, it’s usually cheaper and if you invite another couple to come with then you can split parking.

Frugal Date Idea #5 Work Out Together

Yes, this isn’t the most romantic date, but it is so much fun working out together. Whether it’s a run outside or lifting at the gym, it just feels good to be doing something healthy together.

Frugal Date Idea #6 Free Concerts

My town offers free concerts in the park, check out to see if yours does the same. It’s a great way to get out of the house and enjoy some music.

Frugal Date Idea #7 Go For a Picnic

Pack a picnic and head to a park you’ve both never been to. Then you can explore the area afterwards.

Frugal Date Idea #8 Play Board Games

Get a bottle of wine and your favorite board games from your childhood to play together.

It can be fun just thinking of frugal date ideas or ways to have fun without spending a ton. Surprisingly, most activities can be done for a lot less money if you just get creative with how you’re thinking about it. What are some frugal date ideas you have?

Saving Money

5 Tips to Save Money on Gas

5 Tips to Save Money on Gas

This post may contain affiliate links. Check out my Disclosure Policy for more information.

The summer months usually mean more driving because of the beautiful weather and usually some time off. Unfortunately, gas companies know this and hike their prices up so kindly. Currently, gas prices continue to climb and I’ve been finding myself going over budget basically every month because it keeps increasing. Because of this, I have been focusing more on ways to save money on gas.

1. Don’t Buy Cheap to Save Money on Gas.

I know. This sounds counter productive. But, I learned the hard way the importance of good gas. I’m all about convenience when it comes to gas. So, I always bought gas from the same two gas stations that I passed on my way to work. It was also nice that the price was low. To me, gas is gas and I had no idea that there actually is a difference in quality. My car was running terribly for the last 4 years and the dealership couldn’t figure it out, they just kept replacing the muffler, 3 times, with the issues still happening. Finally, they realized it was due to bad gas and I needed new fuel injectors. Thankfully, they replaced these for free because they had failed to diagnosis the problem for so many years. Now that I am paying more for quality gas, I am noticing that I am getting better gas mileage and I know my car will run better in general.

2. Slow Down to Save Money on Gas.

This has made my gas go so much further for me. I try to keep my speed under 70 MPH on the highway now (I do live in NJ, so this makes me a snail on the highway lol!). It has allowed me to go from averaging 22 MPG to 28 MPG, obviously this in combined with all my tips, but slowing down on the highway has helped the most!

3. Slowly Accelerate to Save Money on Gas.

Along with tip #2, this has also helped me a lot making my gas go further. Whenever I need to accelerate I always do it slowly to burn less gas. Obviously, when you are accelerating it’s going to burn more gas, but by going slowly it helps in lower the amount.

4. Monitor Your MPG to Save Money on Gas.

My car has this wonderful little feature the tells me my MPG and it helps me so much. Whenever I see the number go down I know I am using more gas and maybe I need to adjust how I am driving. I’m a totally visual person, so having this constant reminder is super helpful. If your car doesn’t have this, you can calculate your own MPG when you have the chance.

5. Use a Rewards Card to Save Money on Gas.

One of the best ways I make gas more affordable is by using a rewards credit card (Find out why I use credit cards throughout my debt free journey here). Of course, the only way that this is beneficial and actually saves you money is if you pay your balance in full each month. If you have had credit card debt in the past, I definitely don’t recommend you opening an account just for rewards. It just isn’t worth it. I personally use the Chase Freedom card, which has rotating categories each quarter. The summer is 5% cash back on gas stations, which means I earn money back with each transaction.

These are the tips I have found to save me the most money on gas. I hope these tips can help you to save money on gas. What are some things you have done to save money on gas?