Spending Plan: Prep 1
Last week in this space I wrote about the necessity of getting control of our spending, saving and earning. I closed last week’s column with my commitment to all of you so before we move forward lets pickup from where we left off-
In 2018 I /we will develop the skills we need to live with the amount of money we have.
In 2018 I /we will not allow define ourselves by the amount money we have.
In 2018 I /we will not have a "Budget" – It’s a Spending Plan!
To keep up our promise we need to know where we are today. This is not a job to be multi-tasked. Once it quiets down tonight, go online and check your bank balances. I do this every night after I put the kids to sleep. I need to know how much money I have available tomorrow morning. See what recent transactions have cleared, know your available balance. Are all the funds from your most recent deposit available? These are simple questions but we must always know the answers.
Our relationship with money is identical to our relationship with men. If there is problem we’re better off knowing about sooner than later. A lot of people would prefer to bury their head in the sand than face the truths. Tonight, it's just about you and your money, don’t freak out when you sit down to do this, remember that you’re only looking up and recording down where and how much your spending.
Like I said I do this after the kids are down, I consider this an act of self-care. Knowing my exact bank balances reduces or removes the anxiety caused by being vague about my money, I’m free to not have wonder. Knowing this is kind of gift to myself.
Moving forward, go back to your online bank account, look at your payment history. Which bills are auto pay? You know the ones that get paid automatically each month out of your account, on a separate sheet of paper write down the date, the amount, and what it pays.
Next look at your history and see when you make the regular payments via checks such as rent or the electric bill. Write down those amounts and dates.
I used to take this information and write it on a regular old wall calendar, just like my Granny had in her kitchen above her phone, but last week I promised to modernize this process. Go to your online calendar and make sure that it syncs with all your internet devices. Enter the amounts and due dates into your calendar along with a reminder set a day in advance.
Let’s look at the calendar a different way, on a sheet paper list them all and total them up. This is our target, it’s the number we need to hit each month to pay the bills. Along with knowing bank balances and bill payment due dates- we need to know our how much money we need each month to keep the family rolling.
We now have our numbers. This may seem tedious at first but once this becomes a habit part of your nightly routine like brushing your teeth it will take only a few minutes to keep current and be clear. Start this tonight and continue through the week, let’s just get this process started and next week I’ll lay out the next steps to building a spending plan.