budgeting

How to Stay Within Your Budget: Monitor Your Budget Busters

Monitor Your Budget Busters

We originally published How to Stay Within Your Budget: Monitor Your Budget Busters on February 20, 2017, and have refreshed it for 2021.

It’s not that difficult to create a budget. What’s hard is sticking with it over time. One way to increase your success is to track what you spend. Unfortunately, very few people have the discipline to track every expense. The good news is that you don’t have to do this to be successful.

Most people don’t overspend on everything. Instead, there are usually a few items—let’s say clothing, dining out, or travel—that bust the budget. Monitoring and controlling these budget busters can help you reduce your spending without tedious bookkeeping.

How to Monitor Your Budget Busters

To stay within your budget, monitor your budget busters. You know what they are. Perhaps you go to your favorite clothing boutique and can’t say no to the latest seasonal fashions. Or you find it impossible to browse a bookstore or Amazon without stocking up on the latest bestsellers.

Indeed, it doesn’t help that online shopping has made it all too easy to spend more money without any effort at all. And the pandemic only exacerbated this trend. In fact, consumers spent $791.70 billion online with U.S. retailers in 2020, up 32.4% from 2019, according to Digital Commerce 360.

Though online spending is up in general, the things we overspend on are as individual as we are. Identifying the culprits is the first step to creating a spending plan that will work for you.

A Simple Process to Stay Within Your Budget

  1. Make a list of your budget busters – you know what they are.
  2. Tackle one at a time, or if you are extra motivated and organized, all at once.
  3. Track your spending by employing the techniques below.

The envelope system involves placing your monthly budgeted amount for each item into an envelope in cash. For example, label the envelopes “clothing cash,” “shoe cash,” and “dinner-out cash,” and stash them in your wallet. When the cash runs out, stop spending until the next month when you will refresh the cash.

You may be thinking, “There’s no way I’m going to carry that much cash around.” And of course, there are those airline miles to accrue! In that case, write down your budget busters in your day planner or on a piece of paper that you post somewhere visible. After each purchase, subtract what you spent from your budget. Stop buying when you reach your limit.

If you gave up your day planner years ago and lose every piece of paper you write on, try booting up your favorite tracking software. For example, PocketGuard and Mint.com let you upload transactions from your credit cards and checking accounts to keep track of your spending. Each month, log in to see if you were able to successfully stay within your budget.

Learning to Spend More Intentionally

Alternatively, you can find a trusted advisor or friend to “buddy up” with and help you stay on track. Accountability is a powerful motivator.

Finally, try monitoring your budget busters instead of every expense for a few months and see how it works for you. I think you’ll find that it’s an excellent behavior modification tool. Moreover, you’ll become increasingly aware of spending habits that aren’t in your best interest. Over time, you’re likely to find it much easier to stay disciplined and reach your financial goals.

Do you want to manage your money (and life!) better?

Download The Happiness Spreadsheet and learn how to align your spending with your values for greater happiness.

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Life After Lockdown: Creating a Budget Post-Pandemic

Creating a Budget Post-Pandemic

For the past few weeks, I’ve been teaching a personal finance class at Mills College. The first class covered cash flow and budgeting, so I asked my students to create a budget for homework. To help them get started, I suggested reviewing their recent credit card and bank statements to estimate their discretionary spending habits. One of the students brought up a great point: “I wasn’t spending like I normally do during COVID, so the last 14 months may not be representative of my spending from now on.”

As it turns out, her statement is true for most of us. For example, 64% of Americans say their spending habits have changed since the pandemic started, according to a Bank of America survey of more than 2,500 adults. In addition, a separate Bank of America survey found that 46% of affluent Americans have been getting their financial lives in order during the last year and expect to reach key financial milestones sooner than their parents did. That means many of us not only changed how we spend our money, but we also developed more financial discipline during the pandemic.

Indeed, our spending will likely look different as the world reopens and life returns to normal. Of course, just how different depends on the person. It’s tempting to splurge on the things and experiences we missed most in lockdown (for instance, we finally have a reason to buy new clothes again!). However, I think it would be fantastic if some of us could maintain the money habits we developed when we had fewer options. Creating a budget that reflects those habits can be a great way to do that.

How the Pandemic Changed Our Spending Habits

Life in lockdown forced us to reevaluate many aspects of our daily lives. As our circumstances and priorities changed, so did our spending. Gyms and restaurants closed, and travel was all but nonexistent for the first part of the pandemic. So, where did our money go?

Self Magazine surveyed 1,300 Americans to find out how their spending habits changed during the pandemic. Of the female respondents, 62% said they used time in lockdown to cook more creatively and spent a lot more money on groceries as a result. In addition to our growing grocery budgets while at home, a CIT Bank survey conducted by The Harris Poll found that spending on food delivery was also up 25% during the pandemic. 

However, food wasn’t the only thing we spent more on in lockdown. According to data provided by budgeting app Mint last August, consumer spending on investments, pets, education, and home expenses was up significantly year over year.

While some of these trends may continue, others will naturally return to more normal levels in a post-pandemic world. It may be helpful to keep this in mind and adjust accordingly when creating a budget for the future.

Good Habits We Developed in Lockdown

Despite increased spending in certain categories during the pandemic, more than half of Americans said they spent less and saved more than usual overall, according to the same CIT Bank survey. Thanks to government stimulus and new spending habits, many people were able to save more and pay down debt.

Notably, CRS reported that credit card balances declined about $76 billion in the second quarter of 2020, the largest quarterly decline on record. In addition, data from Experian shows that on average, Americans’ credit scores increased and payment habits improved in 2020.

Yet good habits extended beyond those experiencing financial difficulties before the pandemic. Of more than 2,000 affluent adults (households with investable assets between $100,000 and $1 million) surveyed by Bank of America, 81% said they took the money they’d normally spend on entertainment, travel, and dining and set it aside for savings and emergency funds during the pandemic.

The Pandemic’s Impact on Women

These statistics certainly paint a rosy picture, and many of us have been fortunate enough to come out of the pandemic in similar or better financial shape than we started. Unfortunately, however, many women experienced unprecedented challenges during the pandemic, setting them back even further on their path to retirement.

For example, the U.S. Bureau of Labor Statistics reported women’s unemployment has increased by 2.9% more than unemployment among men since the start of the pandemic. In addition, data from Washington University in St. Louis showed hours worked by mothers fell four to five times as much as hours worked by fathers. Many women had no choice but to leave the workforce to care for aging parents or children. Female participation in the workforce has not been this low since 1988, according to one NPR analysis.

It’s no secret that women have long been at a disadvantage when preparing for retirement. This is because we tend to invest less and hold more cash than men, contributing to our savings shortfall. However, the main driver behind this shortfall is our lower lifetime earnings due to gender pay gaps and caretaking responsibilities—a trend that only worsened amid the pandemic.

Morningstar reports that 55% of all jobs lost in 2020 (2.3 million jobs total) were lost by women. And 32% of women ages 25-44 say they’re not currently working due to childcare demands, compared to 12% of men in the same age group.

If you’re facing any of these challenges yourself, creating a budget for post-pandemic life might be the last thing on your mind. However, closing the retirement savings gap is more critical than ever. Even one small step in the right direction can help you take control of your financial future.

Creating a Budget for Your Future

My suggestion to the student who spoke up in my class was to look back to 2019 as a spending guide. You may find this advice helpful as you’re creating a budget for yourself post-pandemic. However, if you want to continue the good habits you developed during COVID or create new habits to better prepare yourself for the future, be sure to incorporate these changes into your new spending plan. Remember: small, consistent actions over time often lead to big results.

If you’d like to work with a fiduciary financial planner to help you feel better about your money and prepare for the future, please schedule a call to see if we’re a good fit. In addition, you can check out The Happiness Spreadsheet, a fresh, inspiring approach to budgeting that can help you maintain good money habits and develop new ones.

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5 Ways to Boost Your Financial Confidence

Boost Your Financial Confidence

In many aspects of life, confidence is key. But if there’s one category where that emotion is often lacking, it’s financial. Fortunately, April is National Financial Literacy Month. To celebrate, this month’s podcast episode features Jennifer Barrett, author of Think Like a Breadwinner. In addition, I’m sharing some tips of my own for how you can boost your financial confidence to shift your money mindset.

Five steps you can take right now to boost your financial confidence:

1. Face Your Finances

Regularly revisiting your budget, checking in on your accounts, and tracking your net worth are three tasks that any financial advisor would recommend. And for good reason. These tasks may seem simplistic, but they provide you with a solid financial foundation. Moreover, getting a routine down for the basics will also help boost your financial confidence when it comes to tackling larger tasks.

2. Educate Yourself

There is an incredible number of ways to improve your financial literacy. And with the rise of personal finance blogs, podcasts, books, and courses, it’s easier than ever to get your hands on the information you need.

For instance, Curtis Financial Planning’s website contains the Of Independent Means blog and the Financial Finesse podcast, as well as several free downloads and other resources. In addition, the Balance has compiled a handy list of the 10 best personal finance books of 2021.

3. Know Your Worth

Have you gone a year or more without a cost-of-living raise? Or have you recently changed positions, taken on more responsibilities, or spent time honing your skills? If so, it’s time to negotiate a higher salary. Indeed, growing the gap between your expenses and your income will boost your financial confidence. However, it can also help you meet many common financial goals.

Just be sure to do your research to find out how much others in your position are making. For example, websites like Glassdoor will give you the average salary for your position and location. In addition, you can add in your years of experience to get a more specific answer.

4. Set Financial Goals

Two common financial goals are putting together a budget or spending plan and paying down debt. These two tasks go hand-in-hand, and they’re vital for a healthy financial future. Other examples of financial goals include:

• Starting an emergency fund
• Saving for retirement
• Paying off your mortgage
• Funding a dream vacation

Setting financial goals offers a daily reminder of what matters more than emotional spending or convenience purchases. No matter your financial goals, facing your finances, increasing your knowledge, and knowing what you’re worth can help you get there.

5. Partner With a Financial Advisor

Nothing offers a bigger, better, or faster financial confidence boost than partnering with a knowledgeable financial advisor. To get started and cross one thing off your financial to-do list, download The Happiness Spreadsheet. This incredible free resource offers a unique approach to budgeting by aligning your spending plan with your values.

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Simple Truth #3: Contrary to Popular Opinion, You Were NOT Born to Shop

You Were Not Born to Shop

We originally published this article on February 20, 2010, and it remains one of our most popular blog posts to date. In the spirit of ongoing financial wellness, we thought we’d give it a refresh for 2021 as many of us adjust to new habits—including how we shop.

I’m a financial advisor. But I’m also a normal person just like you. I know how difficult it is to be an American and somehow not feel it’s our duty to shop.

Our economic and social systems are based on capitalism. Consequently, economists watch consumer spending like hawks, and no wonder—it fuels about two-thirds of total economic output in the United States. Talk about pressure!

This also puts a lot of pressure on you, the consumer. If no one buys our goods and services, then what happens to our economy?

Advertising Only Fuels Your Shopping Habit

The advertising industry is the perfect agent for promoting consumption. According to the ANA, advertising is linked to the bedrock principles that shaped our nation—free speech, competition, and individual choice—and is a driving force in fueling economic activity.

As such, advertisers have one role: to make us want us to consume. Their mission is to make products and services seem as enticing as possible, so we buy them whether we need them or not. Just watch a few episodes of Mad Men to learn the tricks of the trade.

And it’s almost impossible to escape from the influence of advertising unless you live like a hermit. Watch TV, drive down the freeway, listen to the radio, log on to a website, and you’re bombarded with advertising messages. No wonder we feel like we were born to shop!

Only You Are in Control of Your Shopping Habit

The problem is, economists and advertisers aren’t concerned about your personal bottom line. Just like you, they’re concerned about their jobs, their families, their standard of living, and their ability to retire comfortably.

Therefore, you need to adopt a “me vs. them” mentality when it comes to kicking your shopping habit. In other words, before you open your wallet to buy something, stop and think: Do I want “them” to have my money, or do I want “me” to have my money? The person on the other side of the cash register certainly doesn’t know if you can afford the item you are about to purchase—nor do they care.

Think of shopping as a psychological battleground—that’s how advertisers think of it.  Do you want to be the victor or the vanquished? Remember: you were not born to shop!

Don’t Be the Vanquished When It Comes to Your Personal Finances

Feeling vanquished about your personal finances isn’t a good thing.  It probably means you’re in debt, or you’re anxious about your future and feel stuck. Is all the “stuff” worth it? Probably not.

Excess stuff also clutters your environment. Coupled with your excess debt, this can ruin your credit score and your relationships.

Like anything psychological or emotional, it isn’t easy to change. But there are things you can do to take control of your spending. It’s time to denounce popular opinion, admit you were not born to shop, stop spending more than you earn, and live within your means.

First, Balance Your Budget

Using an excel spreadsheet, list all of your expenses categorized as follows:

  • Fixed and necessary expenses. These expenses are the same every month and/or are necessary to keep you housed, clothed, groomed, healthy, fed, and mobile.
  • Other committed expenses. These may include child-related expenses, pet care, fees to professionals, adult education, gym membership, insurance premiums, and debt payments.
  • Discretionary expenses. Includes vacations, dining out, entertainment, hobbies, electronics, gifts, home improvements, furnishings.
  • Auto-savings. Includes your retirement contributions and other savings.

Next, total the subtotals for each category to come up with your total monthly expenses. Then subtract this amount from your total monthly income. The outcome will either be a positive or a negative number.

If it’s a positive number, congratulations. You are living within your means. If you know you’re saving enough for retirement and other financial goals and have no debt to pay off, then you have some discretion as to how you use your money. However, if the outcome is negative, go back and rework your expenses until it comes out even or positive. Once your cash flow is neutral or positive, you now have a working budget.

Hint: You will have the most flexibility to adjust your discretionary spending, but you can also try and negotiate savings with service providers or increase deductibles on insurance policies to save on premiums. In addition, you should try to eliminate any high-interest credit card debt before adding to your discretionary spending account.  

Some Tips for Staying the Course

  1. Print out a copy of your budget. Post it somewhere that is visible to you regularly, so it stays top-of-mind.
  2. Track your spending. Mint.com is a free online tool that tracks all of your expenses, income, and savings. You can enter your budget, and Mint will send you an email any time you overspend on a budget item.
  3. Try the envelope system. Place your budgeted amount for discretionary items like clothing and food in an envelope in cash. When the cash is gone, you can’t spend on those items again until the next month.
  4. Leave your credit cards at home. Become more conscious that the money you spend is from a finite source. Try paying cash or using your ATM card whenever possible.
  5. Walk away. If you’re tempted to buy an item that you don’t really need, leave the store, walk around the block, and think about it. Nine times out of ten you won’t buy the item. Remember: It’s “me vs. them.” Who gets your money?
  6. Reward Yourself. Each month that you stay within budget, reward yourself in some small but significant way. For example, indulge in a nice lunch out, get a pedicure, or order a nice glass of wine with a meal.

Maybe You Were Not Born to Shop, But You Still Want To

After completing the budgeting exercise, you may find it’s impossible to balance your cash flow. Even though you realize you were not born to shop, you don’t want to live frugally, either. If this is the case for you, look at the income side instead. Can you ask for a raise at work? Find a higher-paying job?  Freelance?  Start a small business? Rent a room out? Sell belongings to raise cash?

Explore all avenues. Exercise your capitalist gene by thinking about all the ways you can produce goods and services for profit—for yourself!

Feel Happier While Spending Less

If you want to think differently about the relationship between your spending, your values, and your happiness, download The Happiness Spreadsheet. In addition to giving you a more inspiring approach to budgeting, our free eBook includes a number of resources you can use to get your shopping habit and spending under control.

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Budgeting For Happiness: Your New Spending Plan

New Spending Plan

Many women resist traditional budgeting because it feels so restrictive. Your new spending plan prioritizes what’s most important to you.

At the mention of the word “budget,” many people cringe. Like the word “diet,” it brings about a sense of dread, thoughts of deprivation, and the possibility of failure. Instead of focusing on the long-term rewards of effective budgeting, you start to focus on what you can’t have right now. When that deprivation mentality kicks in, it makes mindless shopping or impulse purchases harder to resist. But don’t fret; this mindset is fixable if you take a different approach with your spending plan.

The Psychology of Budgeting

There’s a psychological side to budgeting. It involves motivation, discipline, and often a bit of creativity. The idea of budgeting creates an emotional response in your brain, and it’s not always a good one. Creating and sticking to a budget can feel like yet another task on your already endless to-do list, not to mention the fact that this task also involves math, which most of us tend to avoid. But stick with me here because you do need a budget, just not the kind that fills you with an impending sense of doom. 

Why You Need a Budget 

As challenging as it can be, budgeting is a necessary not-so-evil. For starters, identifying where your money is going every month can help you find ways to cut back, increase your savings, and work toward your financial goals. A recent U.S. Bank study revealed that only 41% of Americans use a budget, even though it’s one of the most effective ways to keep track of our finances. 

It’s time to try a better way. Budgeting can help you improve your financial security, limit unaligned spending, and avoid debt and financial stress. It’s one of the quickest and easiest ways to increase your financial control and sense of financial fulfillment. 

What If There Were a Better Way? 

The key to better budgeting is to make it feel less like deprivation and more like prioritization. Understanding your core values, financial and otherwise, and aligning your spending with them can be very motivating. And when you feel more aligned, it tends to lead to greater fulfillment and better habits. 

Here are some suggestions for aligning your new budget spending plan with your values: 

  • Create a financial plan that emphasizes your goals, whether that’s early retirement, real estate investments, or that long-awaited vacation  
  • If you’re estimating costs, it’s always better to be conservative (i.e., overestimate rather than underestimate)
  • Link your spending to things that you value—this may require some self-reflection work, but it will be worth it 
  • Use visuals to maintain your motivation (pop pictures on the wall over your desk or create a vision board on Pinterest), and revisit your goals regularly  
  • Give yourself grace and a chance to rework the numbers or try again if you fall off track 

Your New Spending Plan

To implement these ideas in your own budget, download The Happiness Spreadsheet for a fresh, inspiring approach to budgeting that aligns your spending plan with your values.

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Single and Thinking About Retirement? Five Tips to Help You Get There

Single Women Retirement Planning
Single Women Retirement Planning

Most of us dream about the day that we can take a break. We envision a full, long-lasting retirement that is free of financial worries and packed with more of the things we enjoy spending our time on. Whether you’re planning to retire at the traditional age of 65 or you’re aiming to get there earlier, being single doesn’t have to slow you down.

Use your unique strengths to your advantage, and plan for a retirement filled with time spent with friends and family, giving back, reading books, traveling, and everything else you enjoy. If you’re thinking ahead to your retirement, but you’re not sure where to start, here are a few tips that will help you get there:

Revisit your spending and saving

The start of your retirement planning is a great time to check in with your spending or looking at it in reverse, at your savings rate. Could you be saving more money? Are you spending on things that aren’t important to you? Are you wasting money anywhere, such as trial subscriptions you forgot to cancel that are now costing you money annually? Paying for a high-priced gym that you rarely use? Highlight anything you think can be cut out or reduced. Savings gives you freedom and it’s something you have control over, more than your investment returns or even your income.  Then, use Vanguard’s handy retirement calculator to compare your current monthly income to what you’ll need in retirement. 

Make small changes

Now that you’ve revisited your spending vs savings rate and identified areas that could use improvement, start making small, incremental changes. Save takeout or restaurant meals for weekends; make coffee at home instead of suffering through long drive-thru lines; cancel unused services or subscriptions. Discretionary items like these add up quickly to cost us thousands each year. Aim for improvement, not deprivation and watch your savings grow. Cutting out all discretionary spending isn’t sustainable long-term. Choose the changes and budget cuts that make the most sense to you and your goals.

Max out your savings

Reallocate the funds from your discretionary budget cuts to your retirement accounts or investment accounts. While opting for easy alternatives may have been eating up all of your extra cash, maxing out your savings opportunities will make you extra cash. When it comes to saving for retirement, compound interest is your best friend. Start spending time with her as soon as you can.

Diversify

Any personal finance expert will tell you that it’s not enough to match your employer’s contributions (or fully fund your Solo 401(k) if you’re self-employed). Investing outside of your retirement account in mutual funds, ETFs, or individual stocks can help you create additional streams of income when you’re settling comfortably into your retirement.

Work a little longer than you think you can stand

While you are working your salary funds your expenses. When you stop working you are going to rely on other income sources: social security, maybe a pension, and withdrawals from your retirement and investment accounts. If your retirement projections are at all iffy – meaning, it seems your money may not last through your retirement years, it pays to stay employed. Most people want to maintain their standard of living in retirement not have to reduce it. Staying employed and savings as much as you can in those last years of working is one way to get you closer to your goal.

No one-size-fits-all plan for retirement

There’s no one-size-fits-all plan for retirement. But if your end goal is a retirement free of financial worries, there are plenty of actionable steps you can take now to set your future self up for success. A lack of financial stress helps us better connect with the people we love, sleep better, stay healthy, and enjoy both the destination and the journey. Employ financial strategies that will help you move consistently toward your goals.  

If you need a retirement plan and want to work with a trusted financial partner, we encourage you to explore our services and schedule an introductory phone call.

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Creating New Spending Habits After Shelter-In-Place

Cooking At Home

One of the most desired and, at the same time, hardest-to-do financial tasks is to create a budget and stick to it.

I know this from my personal experience and that of my clients. It is the rare person who enjoys purposefully creating spending limits – because that is what a budget does – it sets limits on spending. These limits are necessary to reach important savings goals like retiring or buying a house, but that doesn’t make them any more comfortable. What if there was an easier way to create new spending habits?

Why not take this rare opportunity to create new spending habits instead of going back to the old?

Admit it- you enjoy cooking more than you thought you did, and you can’t believe how much money you are saving by not eating out as much. You look in your closet and you are dismayed about how many clothes you own and don’t wear – and you don’t think you will need them after you no longer have to shelter-in-place. You’ve enjoyed neighborhood walks and Zoom Zumba classes much more than you ever liked going to the gym. If this is you – take the opportunity to build a new budget around this lifestyle. You don’t have to eliminate all past activities that you once enjoyed, but you may find it much easier to cut back now.

Want to make budgeting more fun? Download The Happiness Spreadsheet, a free tool that helps you create a budget you can live by!

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Budgeting for Happiness with Spreadsheets On Spreadsheet Day

Nowadays, it seems there is a “day” for everything. And, today, October 17, is spreadsheet day. Spreadsheet day commemorates the day the first spreadsheet program, Visicalc, was released way back in 1979. Spreadsheets are a great tool because they help us to organize and categorize data into a logical format. Then, we can use them to analyze or help solve a problem or create a solution. 

Cash Flow Spreadsheets 

As a financial planner, one of the things I help people with is their cash flow – making sure that what comes in and what goes out is sustainable over a lifetime. It starts with a typical spreadsheet – a list of items and what they cost each year and then projected out over several years. The columns and rows add up into numbers that can be analyzed. 

But when it comes to spending, it’s not as easy as it sounds. Since resources are finite for most people, where the money goes has a significant impact on a person’s quality of life. Lots of people lose sight of this in living and spending day-to-day. For example, they may spend money on things or experiences that aren’t that important to them, and not have money left over for the things that are. Or, they may have a long term goal that requires saving up for, yet, they continue to deplete their checking account each month without saving a dime. 

Some of this spending behavior is a function of how our brains work. Immediate gratification is very compelling, and it’s hard to focus on longer-term goals unless we make it a habit. Another brain feature that makes it hard to be a disciplined spender is that our brains like novelty. We prefer new and shiny objects or situations – much more than the same old, same old. These biological brain cravings are hard to overcome unless we do it on purpose. That is where my brain hack for controlling spending comes in, and yes, it’s a spreadsheet: The Happiness Spreadsheet.

The Happiness Spreadsheet- what is it?

Filling out a Happiness Spreadsheet requires you to think hard and identify the things and experiences that are the most satisfying to you.  

It also required you to admit that you may be spending money on things that aren’t important to you at all. For example, you may own an expensive car that costs a lot to maintain and is a hassle to park, when you would rather walk, take public transportation, or rideshare. Or, you love to cook and eat simple healthy meals, but instead, you eat out four times a week. Once you identify your values and desires, you can focus on bringing more of them into your life through your spending habits.

Want to give the Happiness Sheet a try? You can download a free copy here: https://www.curtisfinancialplanning.com.

Happy spreadsheeting!

 

 

 

 

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Just Retired? 10 Ways To Keep Spending Under Control

Just retired? Here are a few ideas about how to keep your spending under control. Does this sound like you?

You have just retired, and you’re exhilarated. Each day dawns with no schedule. You can sleep in or get up early. You can fiddle around the house all day or go out with friends. You can stay out late, enjoy another glass of wine and not worry about being alert for a meeting the next morning. You answer to no one but yourself (or your significant other).

You start to enjoy yourself. You start traveling to places that you have always wanted to go and you find wonderful treasures that you want to bring home. You go out to eat more often because you like being out of the house and you don’t have to get up for anything in the morning. You go to plays, concerts, and other live entertainment more often.

After about a year of pure fun, you want to feel productive. So you volunteer and donate your time and money.

You’re having the time of your life.

What Happens After the Honeymoon Phase of Retirement

Then, the credit card bills start to come in, and the balances due are large. You deplete a savings account and maybe have to sell some investments to pay bills. You start to get worried that maybe you’re spending too much. The stock market is in sideways mode, and you don’t see any growth in your portfolio. You realize it’s time to slow down and take stock of the situation.

If this all sounds familiar, you’re not alone.

It’s not uncommon for people to become accustomed to a certain standard of living or way of life. It’s not easy to adjust. It’s also not unusual to want to enjoy the new-found freedom that retirement brings. Yet, it’s a good idea to be aware and thoughtful about what is going on and try to bring things back under your control.

10 Ways to Keep Spending Under Control

Here are a few ideas about how to keep your spending under control:

  1. Presumably, when you retired, you had spending goals. At the beginning of each year, go back and check these assumptions to make sure you are still on track. If not, make adjustments in your spending.
  2. If you don’t want to cut back on your lifestyle, consider working part-time. Perhaps you can use your skills on a consulting or part-time basis.
  3. While traveling, consider renting out your home to bring in extra cash.
  4. If you have an appropriate space in your home, convert it to an Airbnb rental.
  5. Turn a favorite hobby into a business.
  6. Take more stay-cations. Be a tourist in your own town. It will save you on airfare and hotels, dining out and shopping.
  7. Reassess your need for new clothing and accessories. It’s likely that you don’t need as much now that you’re not going to a workplace daily.
  8. Consider selling items that don’t fit your new lifestyle at consignment shops or eBay.
  9. Let your friends know that you want to cut your spending back and ask for their support.
  10. Find things to do that don’t cost a lot of money.

Remember, sometimes the finest things in life are free.

Do you want to manage your money (and life!) better?

The Happiness SpreadsheetIf you want to think differently about the relationship between your spending, your values and your happiness, then sign up to get your FREE copy of The Happiness Spreadsheet.

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Where Creativity and Finance Connect

It was a beautiful sunny Saturday afternoon and the light was streaming in the windows of the cozy art studio. A long table was covered in butcher paper and  cheese and crackers, frittata and chocolate bars were ready to be consumed. As Tamara and I finished getting the room ready for our workshop, the attendees (all women)  began to arrive one by one, ready to challenge themselves to a few hours of personal exploration and discovery.

It was the Happiness Spreadsheet Workshop entitled “Where Creativity and Finance Connect”, and the exercises these women were about to embark on were from my newly published ebook, “The Happiness Spreadsheet.” I asked artist and attorney, Tamara Holland of Bean Up The Nose Art if she would team up with me to lead the “right-brain” creative exercises while I led the more analytical work. I couldn’t think of a better partner and I was fortunate that she enthusiastically agreed to work with me.

What is a Happiness Spreadsheet?
It’s a budgeting tool that guides and inspires the reader to figure out what is most important to them – experiences, things, people, causes, beliefs and goals – and then to apportion their resources (money and time) so that they can bring more of those things into their lives. Most of the women attending the workshop had done budgeting of one kind or another, but no one had ever thought to connect their budget with their values.

For example, if you love travel, what does that say about you? Perhaps that you thrive on adventure, excitement, or unpredictability. If you are a home-body, you may crave stability, safety and familiarity. If you value sustainability, you want to eat foods grown organically and locally or consume less and recycle more. Or if you desire more leisure in your life, you may want to hire more service providers to give yourself more time. Whatever it is, the better you know yourself, the more likely it is you will focus on your happiness triggers and bring more of them into your life. In our busy lives, we often just “do” and don’t spend much time thinking about “why” and then wonder why our lives feel stalled or unsatisfying. Or, we end up spending our scarce resources on things that don’t matter that much to us.

When the ladies were asked why they signed up for the workshop and what they wanted to get out of it, these were some of the replies:

“I’ve been giving a lot of myself to others for a long time now, and I want to focus on myself. I’ve forgotten what I want most out of life.”

“I’m going through some major transitions right now and I want to decide on my next move with thought and care. I thought this workshop would help.”

“As I get older, I find that I want to spend my time and money more consciously and stop frittering it away on things that aren’t that important to me.”

“I spend so much time at work and recovering from work that I don’t think about where I want to spend my time and money. I have the resources, I just don’t know how to best use them.”

The Happiness Spreadsheet Workshop Vision Artwork
The Happiness Spreadsheet Workshop Vision Artwork

I think it was unanimous that the favorite exercise involved  painting. Not with a brush but with credit cards! Tamara had each woman sprinkle three large sheets of paper with several colors of  paint and then using the edge of a credit card, scrape the paint across the page. This technique created the most wonderful art and then the sheets were used as the base for vision-boards. I can’t think of a better use for a credit card, can you? One of the numbers-based exercises consisted of allocating $2500  amongst a list of different things or experiences  – a real-life experience that we all do but perhaps not as consciously as we should.

At the end of the workshop each participant was asked to do a “show and tell” of their vision artwork. This was fun and inspiring. See a few clips below.

The Happiness Spreadsheet Workshop Vision Artwork
The Happiness Spreadsheet Workshop Vision Artwork

Tamara and I are  planning our next workshop on June 23rd in San Anselmo, California. If you would like to attend, email me at cathy@curtisfinancialplanning.com for details.

Tell me: Just how happy do you want to become?

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Curtis Financial Planning