Living on a budget does not mean you cannot enjoy life.
There are many ways to budget to accomplish your financial goals. However, budgeting can feel punitive and prohibitory if we do it the wrong way. Here we have three ways to make sticking to a budget easy to continue for the long term.
Photo by Diane Helentjaris on Unsplash
Budgeting is very similar to dieting; our brain knows that it will be good for our body but our body hates the brain for it!
If you have ever tried to suddenly begin a brand-new diet but then fallen back into your old habits after a week or a month, the same can happen with a strict budget. The trick is to ease your way into the change. By slowly incorporating changes into your lifestyle to reflect your desired budget, you will be more likely to continue with the changes over a long period of time.
For example, let’s say you regularly rely on food delivery for dinner every night. You can change your habit by identifying nights of the week that you will instead make dinner at home. You can start with one night, then two, and eventually you will only be ordering delivery one night a week! This will open a huge amount of money that you can put towards saving or investing.
Let’s look at the math: if the average delivery costs about $22 ($15 meal, $5 delivery charge, $2 tip), when you use it every night that is about $154 per week, $660 per month, and $8,030 per year. When you reduce your delivery to once a week that is $22 per week, $88 per month, and $1,144 per year.
That is a savings of $6,886 per year! If you were to put that into a stock portfolio that yielded 8% every year for 5 years, you would have $40,388.75!
By reducing a habit like food delivery over time, you will adjust your life to maintain the new circumstances and save yourself a hefty sum.
Living on a budget is a skill that takes time to learn.
With learning any new skill, eventually you will learn how to bend the rules without breaking the game. While you are learning how to budget, take the time to find free alternatives for your favorite activities. This will help you replace expensive habits and, with time, you will wonder why you ever paid so much for things you can get for free!
For example:
• Love to read? Join your local library (You can save about $250 a year!)
• Love to go out to the movies? Find a community movie event.
• Love to drink beer? Volunteer at a beer festival.
You can still have fun while you budget.
Including a “Fun” category to your budget will help you avoid making impulse purchases when you want to rebel against your own non-fun budget. You can also start a side gig and have anything you earn pay for your fun expenses. This way you are motivated to work for your extracurriculars rather than stressing out about digging into your tight budget for a movie night.
Let us say you walk your neighbor’s dog once a week for $15 per walk. That covers the cost of a movie ticket (usually about $12) and some candy (if you buy it anywhere other than the theater).
By creating extra income that is geared towards satisfying your need for entertainment, you will be more likely to stick to your budget without feeling imprisoned by your own rules!
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