Living and Spending with Intention

Living on a budget is much different than putting your pay check in the bank and just spending at will. When you go on a budget, you are living (and spending) on your terms. Even with my very first job a fourteen, I always sat down each month and made a plan as to where my spending was going to go. I made $3.15 per hour cleaning at the day care across the street. During the summer, I would pick up extra hours helping in the class rooms. I budgeted for things I wanted, clothes, make-up and arcade. Later as a single mom, it became a necessity as I balanced rent, utilities and baby items. If I didn’t put it in my budget, I did not buy it. I did, on occasion put unbudgeted items on a credit card or borrow for a car, but I put those payments in my budget. Like many in my situation, I had more expenses than income and had to get creative. I often would clean for a friend or do child care for someone who worked nights.

I didn’t realize until I started helping folks balance their checkbooks and friends would share with me their own financial struggles that  not everyone did this and even less looked at this as a tool to help them plan their future. There are so many just living pay check to paycheck without developing a plan for those pay checks. It is at these times it becomes even more important to be intentional with spending. I budget every dollar with anything left going into a rainy-day savings fund. There are several concepts out there for budgeting. Two off the top of my head are the envelope plan and  Dave Ramsey’s program. I like the envelope plan if one is disciplined to only spend the budget. With this plan, you take your paycheck and put cash in envelopes for each week and some even go as far as to divide up and put cash away for rent etc. Most clients I work with would not be disciplined enough to do that. Instead, I encourage a main checking account and a bill account. If your bills come to $4500 and your pay day is biweekly then I would ask you to put $2250 in twice a month or $2300 so that you could build up the account to have a buffer for unexpected expenses. Then I encourage folks to budget their gas, meals and fun. Next, I ask them to take that out in cash to put in envelopes for each week or put on a Debit or credit card designated for spending. I like the TrueLink card as it allows someone to spend only what is on the card and segregate or block items. It does have a monthly fee though.

When I say intentional, I mean you sit down decide what you want your money to do for you (Life Plan). Then you make a plan to get there. If you don’t have enough income to save, well then you really only have two options: Earn more income or cut spending. Maybe you already work two jobs? In this case, perhaps you can look for a better paying job, ask for a raise or look at what expenses you can eliminate. Do you really need that $8 latte? Can you bring lunch from home or buy a refillable water container instead of buying bottled water? Work 4 ten-hour days to save on gas and meals at work? Time to get creative. When I am working with a family who has more expense than income, I usually ask clients for six months of bank statements. I put all non-bill spending on the chopping block. Then ask them how much they think they spend on groceries, gas, and all those misc. spending items. Clients are usually not close (much lower than actual) to the amount.  We sit down and come up with a budget for those items. This is what makes or breaks a successful client. Those that are determined to pay off debt, will work really hard to stay within the budget. A year of saying “No” to non-essential spending will pay off a great deal of debt and free up money. When that happens and creditors are not calling every other day, a lot of stress and anxiety disappears. I find those that make it through the first year of budgeting, have a better quality of life. Not only because they are better off financially but because they are living with intention. It is not just about money but the bigger picture and how you live your life-with a purpose and intention.