In the first of this series on financial well being and health, Just Do It, we walked through the steps of a Fully Fit Plan. I encourage people to take a look at where they want to be before they look at where they are.It’s the same philosophy as Jim Rohn’s excellent quote “You are the average of the five people you spend the most time with.” If you’re hanging out only with your current spending plan, only looking at your current reality, energetically you’re creating the same plan for yourself, repeatedly.
If every month you first look at your Fully Fit Plan, it will remind you where you’re headed, where your intentions and dreams are. Simply writing the Plan out declares to the universe, and to your subconscious, that you are on a path.
It also prepares you for a dose of reality: your current spending plan. Now it's time to look, see and tell the truth.
It’s true that not everyone reading this sees their current spending plan as dismal, tight, something to move beyond. But I’m thinking many of you do. If you’re current spending plan had an extra $1,000 a month in it, you probably wouldn’t be reading my blog, you’d be at Intelligent Investing reading Chris Barth.
In my last blog, 3 Money Steps Toward Joy This Holiday Season, I wrote about putting together a mini-spending plan for Holiday Spending. If you’ve never done a spending plan before, it’s a great way to start by just focusing on one month. It’s less overwhelming. If you’d like guidance on walking through it, you can join me on a free training: Empower Your Holidays.
If you’re ready to roll up your sleeves and get to work on your overall spending plan, here’s the three pronged approach I recommend. Get your calculator out, a pencil, and start tallying.
- #1: The obvious: Your bills, mortgage, rent, telephone, utilities, daycare, gym, etc. You know these amounts, they rarely fluctuate, and without changing or canceling the service, you have to pay it each month.
- #2: The slightly less obvious: Groceries, eating out, tithing, gasoline, entertainment, clothing, etc. These are all areas that we truly can impact. They can fluctuate wildly, but they rarely do because we are creatures of habit. If you haven’t been tracking your spending, you’ll have to guess in these areas and refine later. It doesn’t have to be perfect; it just has to be done.
- #3: The out-of-sight, out-of-mind: car maintenance, vet bills, dental bills, vacation. Most of my very brightest clients, before they came to me, didn’t take these predictable expenses into account in their monthly budget. They were living paycheck to paycheck, but managing, until one of these ‘unexpected’ expenses arose. Even though there are many months that we don’t spend in any of these areas, we must make it a part of our monthly plan, and we must set funds aside. Otherwise, the constant surprises keep off balance and off of our path.
I can’t say enough times: keep it simple. Too many categories are overwhelming. If you’ve never done this before, and need a simple tool to start with, there’s a free tool you can use at TheFinanceGym.com. If the income you can count on doesn't exceed your planned expenses, take a look all categories and find a balanced way to shave. Keep reading this series, and you’ll continue to learn how to refine your plan, use your plan, and develop the willingness to follow it effortlessly.
Come back, consistently, and create a healthier, stronger financial life.
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Stacey Powell builds financial muscles at TheFinanceGym.com, creates financial clarity at CreatingAnswers.com, and shows off Financial Art at Facebook.
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