Monday, 3/29/21: Talking about budgeting, lunch breaks and stovetop popcorn
Happy Monday!
And for all who are celebrating, wishing you a very Happy Passover and happy early Easter! It’s also a new week, which means it’s time for your next Monday motivation newsletter. Read on below for some steps to a happier Monday, a short story and a roundup of positive thoughts to get your week started.
Three Steps to a Happier Monday
Each newsletter starts with three prompts to inspire gratitude and simple intention setting. Take a moment and jot down answers to these three questions. To give an example, I share my answers below.
Step 1: What are three things I appreciated from the weekend?
Step 2: What is one thing I can be excited about today?
Step 3: What is my intention for this week?
GRATITUDE: From my weekend, I am thankful that I was able to catch up on sleep, for phone conservations with my mom and for the beautiful pink tulips that are currently cheering up my apartment.
TODAY: Today I’m most excited about treating myself to a manicure after work – a fun Monday pick-me-up!
INTENTION: My intention this week is to take a midday lunch break each day. Nothing crazy or too long, but my intent is to step away from my computer and all the notifications for just a beat, so I can return more refreshed for the afternoon.
Okay, your turn! And if you want to share your three steps, I am all ears. 🙂
Meaningful Musings: A Lighter & Brighter Approach to Budgeting
It’s the last Monday of the month, which means it’s time for the second installment of the Lighter & Brighter series!
The Lighter & Brighter Series is like a monthly book club… but sans books and focused on making everyday parts of life more enjoyable. Every other month, a new topic is introduced with some ideas on how to make said topic more enjoyable and lighter. If any of it resonates with you, we’ll use the next month to experiment together and share feedback. Then, reactions, tips and tricks will be featured anonymously in the month that follows, so we can all learn from one other! The result? We’ll end 2021 with our very own joy toolbox, filled with a variety of strategies, hacks, tips and tricks for bringing lightness into six different areas of our life.
For the last two months we focused on lighter Mondays (because of course!) and today we are diving into the very exciting topic of budgeting.
I’ve been wanting to write about the topic of budgeting for a while now because, like Mondays, I think budgets automatically get a bad rap. Maybe you shudder just at the mention of “budget” or even declare it one of your least favorite words. I get it. Most think that budgeting needs to be approached from a complicated, restrictive, depriving place, and why would anyone like that?
But what if there was another way? What if it wasn’t the budgeting itself that was intolerable but rather the way we think we “should” be approaching budgeting?
That’s what I’m excited to write about today. My intent for today is that at the end of the newsletter, you simply think of budgeting in a new way.
One of the reasons I haven’t written about budgeting before is because the topics of money and finances are so personal and so dependent on one’s own circumstances. I’m also completely unqualified to give any type of financial advice, so let me just start by saying that I won’t be doing that today.
I’m not a financial expert. I did not study anything related to finance in college and I don’t work in finance now. So, while today’s newsletter isn’t about things like financial planning, retirement savings or investments, I am excited to share my own experience with a mindset shift around budgeting and the light structure I rely on today to make the whole process more enjoyable.
You see, learning to budget truly changed my life… and I promise this is not just me being dramatic. We’ve all heard that money can’t buy happiness, and I believe that to be true. But I also believe that learning how to successfully manage our money allows us to be more relaxed, more joyful, more capable and more generous individuals. For me, finding a way to budget makes me happier on an everyday basis. And that’s how it has changed my life.
Now, before we dive into all the good stuff, let me segue to a quick back story about how I became interested in budgeting in the first place: When I graduated college in 2016, my boss at my on-campus job gave me a copy of a Dave Ramsey book for a graduation present. Besides thinking it was a nice gesture, I didn’t think much of it at the time. But once I cracked open the book, my mind was exposed to a whole new world (aren’t books amazing like that?). Not because I agree with everything Dave Ramsey teaches or follows his suggestions religiously, but rather, his book and message got me thinking about the topic of personal finances in general and how I personally wanted to manage my money.
The timing was kismet because I had just decided to take a post-graduate internship offer with a public relations firm in Chicago. This meant I would be living out a dream of working for a large agency and living in a big city, but I had no idea how I was going to make it work financially. The internship paid around $12/hour.
That first internship turned into a second internship with a similar hourly wage, which meant for nine months, I had to figure out how to take my paycheck and stretch it like an elastic rubber band to cover my living expenses*. By a lot of trial and error, I eventually found success by tracking every dollar I spent and setting up a budgeting system that felt good to me. At the end of those nine months, when I was finally hired full-time and started to make a salary, I had not only figured out how to cover my necessary expenses, but I had also set up an emergency fund in my savings, saved for fun things like being bridesmaid, and avoided going into debt. In fact, I didn’t even have a credit card for that first-year post-college. The bank had declined my initial request (lol), so it was all debit card for me.
*While I was solely responsible for 98% of my expenses, there’s two things I want to call out to ensure I’m providing all the context, which I feel is super important to do when writing about money: 1. I did not graduate college with any student loans (this was a combination of choices my parents made and deciding to go to school in-state because of scholarships. Say what you want about the state of Florida, but the college funding options for local residents are amazing.) and 2. During my internships, my parents kept me on their cell phone and insurance plans (… and I’m actually still on their cell phone plan…eek!).
So, while I didn’t study budgeting in school (I wish that was offered!), I do feel like a student of budgeting from my experiences. I recently read the fun financial fable The Latte Factor (more on it below!), and during the story, one of the characters said something that I really related to. In the book, the character says, “The solution to your money problems isn’t more money; it’s new habits.” The character goes on to say that, of course, a healthy income is a wonderful and helpful thing, but growing your income bigger just takes whatever money problems you have and makes those bigger too. Anyone else thinking of Biggie Smalls right now?
When I sat down to write this newsletter, I thought about this quote and reflected on my own habits I’ve formed to help me enjoy the process of money management and budgeting. When I distilled everything down (the successes, the failures, the annoyances, the fun parts), I came up with my four most-trusted tips for money management, or as I’ll simply refer to them: C.A.S.H. (because who doesn’t like a thematic acronym?!).
C.A.S.H. is ordered the way it is, not just for the acronym, but because I think it’s easiest if each step is completed in chronological order, one at a time, and at one’s own pace (not all at once – no races or gold medals here). Absolutely nothing in the below is groundbreaking information, but I do think all four of these tips are worth mentioning because, in my opinion, they are a bit different than the typical financial advice we see in the mainstream media. These four tips are things I still rely on today and what I wish I would’ve known from the very beginning of starting to manage my money. So, without further ado, let’s get into it!
CASH (My Four Most-Trusted Tips for Money Management):
- Calculate your specifics.
Before any of the fun proceeds, start here. Calculating your specifics is all about figuring out two main things:
- What’s your “take-home pay”? Or, what’s the amount left on your paycheck after taxes, benefits and voluntary contributions are taken out?
- What’s your total cost for all fixed expenses? What’s everything that, no matter what, you are on hook for paying each month? This includes things like rent, electricity, internet, Spotify subscriptions, gym membership, etc. Write them all down and add ’em all up.
Now, it’s important to note that for calculating your take-home pay, I’m speaking from the experience of someone who knows in advance the amount that will be on my paychecks on the 15th and 30th of the month. If you work in a more creative or commission-based profession, calculating your take-home pay is a bit trickier, but luckily, there are a lot of great resources out there on how to approach that situation from people who know much more than me.
After you have these two numbers, that’s it. Just write them down, take a breath and move on to step two when you feel ready.
- Always be saving for something.
This is where it starts to get fun. For this, I’m not talking about pre-tax retirement savings (super important, but not my lane), but rather, getting in the habit of putting aside some “fun money” from your take-home pay each paycheck.
Even if it was just $10, I’ve put aside something for savings with every paycheck I’ve received because I know if I want to be able to save later, I need to be able to save now. Remember the quote above? The solution to your money problems isn’t more money; it’s new habits.
And this is actually really enjoyable to do. How? Every paycheck I’m deciding what fun thing I want to save for. For example, because of my trusty Excel spreadsheet where I keep track of everything, I know that total number in my savings account is spilt up between a bunch of different categories, including sensible things like an emergency fund and “fun money” things like a trip fund, gifts-for-friends fund, always-a-bridesmaid fund, home décor/projects fund and more. For example, I even have a small “seasonal shopping” fund because I know when the seasons change, I get an itch to refresh my closet a bit.
The first time I really experienced the magic of this step was when a friend came to visit me in Chicago while I was still interning. We had the best weekend, but with dinners out and drinks at rooftop bars, it got quite expensive, quite fast. I remember thinking if I hadn’t planned in advance, the weekend would have likely been tainted a bit because of my nervousness around how much I was swiping my debit card. When Monday rolled around and my friend left town, I would have probably avoided my bank account for who knows how long out of fear of seeing the charges.
However, because I’d been prioritizing saving for this weekend and padding my “trip fund,” I was fully present, in the moment and soaked up every experience. It was some of the best money I’ve spent.
So, what do you think? What “fun money” category would you like to contribute to with your next paycheck?
- Say goodbye to restrictive categories.
When you think of budgeting, do you automatically think of a pie chart with all those suggested percentage guidelines of how to spend your money? 25-35% on housing, 5-10% on utilities, 5-15% on food, 10-15% on transportation and so on.
This is how I first tried to approach budgeting. I tracked all my expenses in an Excel spreadsheet and tried to reconcile them against a myriad of categories, attempting to not overstep any of the “recommend” percentages.
A few weeks into it, I was ready to throw in the towel. My percentages did not look anything like the recommendations (for example, my housing was more than 50% of my income, but I also didn’t have a car and could walk to work) and plus, I found myself spending a lot of unnecessary energy on silly things. For example, if I went to Target and bought some groceries, cleaning supplies and a cute top (because #Target), how would I reconcile that in my budget? Food, home items or shopping? It was too much!
I decided this was not how I wanted to spend my time. But instead of giving up on budgeting all together, I tried a different approach, which included bidding adieu to the notion of categories.
Instead, what I do now, is take the information from the first two steps to determine how much money I have to play with until my next paycheck. And, as long as I stay within that amount, I’m free to spend it as I see fit.
Take-home pay – (fixed expenses + savings) = money-to-spend until next paycheck
For example, let’s say your monthly after-tax and other deductibles salary is $3,000 and it’s deposited in your account as a $1,500 paycheck twice a month, on the 15th and 30th of the month. Let’s also say your fixed expenses total $1,600/month and you’d like to save $200/month in “fun money” categories. Note: these numbers are completely made up because they make the mental math easy.
So, for one paycheck received on either the 15th or 30th of the month, you would subtract $800 (1/2 of the fixed expenses) and $100 (1/2 of the savings) and be left with $600 to spend over the next two weeks, until your next paycheck.
This feels a lot freer, right? I love the autonomy of deciding what I want to spend money on. Sometimes I might pick getting my nails done and an expensive dinner with friends and spending a bit less at the grocery store. Or other times I may decide to dedicate more to saving for a trip and keep it low-key on the weekend.
When I think of budgeting this way and see the money available for spending for the next two weeks, I’m able to get clear on what matters. What do I want to spend this money on? Before I buy something I think, is this purchase worthy of taking away from my money-to-spend until my next paycheck?
Try this for yourself! Take what you identified from the first two steps and see what your “money-to-spend until the next paycheck” is. What will you do with it?
- Habitually track everything.
So, now that you’ve calculated your actuals (take-home pay & fixed expenses), started saving some “fun money,” and ditched those restrictive categories, it’s time to talk about how to put it all together. If the first three steps are the WHAT, this last step is the HOW.
It’s the most important step (in my opinion), but I left it for last because I didn’t want anyone to automatically stop reading after the potentially polarizing sentence that I’m about to write. Promise to stick with me? You’ve made it so far!
I am a believer in manually tracking every expense. So much so, that I have manually tracked every one of my expenses for almost five years now. As mathematician Karl Pearson put it perfectly, “That which is measured improves. That which is measured and reported improves exponentially.”
And tracking my expenses has actually become one of my most favorite activities to do. I find it quite therapeutic. Once or twice a week, I open my Excel spreadsheet and bank account, and I log the charges from my credit card (yes, I did eventually get approved!). The whole process only takes about 5-10 minutes. I keep track of how I’m doing against my money-to-spend until the next paycheck, and when I get that next paycheck, I have fun setting aside half of my fixed expenses and deciding what “fun money” category I should fund.
Will I do this forever? Who knows. But as someone who is still trying to stretch their paycheck and someone with pretty simple expenses, it’s what is working for me right now/it’s what has worked for me for the past five years.
I know there are a lot of apps out there that can do this kind of thing automatically, but for me, manually tracking makes the transactions feel real. Similar to the idea of asking what’s going right instead of what’s going wrong, manually tracking helps me focus on what I do have money for instead of what I do not. We all carry innate belief systems about money, and I think there is the tendency for most of us to lean toward a feeling of scarcity vs. sufficiency (the book Soul of Money talks a lot about this – more below). Every time I open my spreadsheet and input my expenses, I’m reminded of all the things I am able to afford. It makes me feel proud and in control, and it brings more meaning to those hours I’m logging every week at work.
So, if this piques your interest, maybe you start by tracking your expenses for just one week to see how it feels. With a new month and a new quarter (so crazy!) beginning later this week, it could be the perfect time to start something new.
I know this was a long one day, but I hope it was helpful and I can’t wait to hear what you think. As a reminder, you can easily submit an anonymous thought, tip or trick about budgeting here and it will be included in the newsletter at the end of next month.
Happy Monday!
On My Monday Radar
Sometimes we just aren’t ready to jump into our Monday to-do list right away. In case you want some content to procrastinate with, here is a roundup of a few positive things on my radar:
- Have any budgeting tips to share? By now, you know the drill: all throughout this next month, I’ll be collecting tips, tricks and favorite resources on how to bring more lightness and brightness to the topic of budgeting. If you are so inclined to share, your input will be shared anonymously in the newsletter on the last Monday of April. As a reminder, here are the reactions from last month when we talked about cultivating happier Mondays. Can’t wait to see where this budgeting topic takes us!
- Two books about money that I found helpful that have nothing to do with budgeting: Both of these books were mentioned above, but if you are looking for any book recommendations about money, I highly recommend checking out The Soul of Money by global activist and author Lynne Twist and the short financial fable/parable The Latte Factor by David Bach. Neither of books even mention budgeting advice (The Latte Factor literally says “don’t budget”). And while I’m obviously a big proponent of budgets (in whatever way feels good to you), I still learned so much from each of these books. Highly recommend both, and if you have any book recommendations on this topic, would love if you passed along!
- Did you watch Oprah’s interview with Chip and Joanna Gaines? I watched it live a few weeks ago and loved the conversation. I was so excited to see that the conversation is now available as a podcast episode too. There was a lot I liked about the conversation, but my favorite topics were hearing their perspectives on money and on religion. I really appreciated their honesty and viewpoints.
- Do you take a lunch break? I’m notorious for thinking I’m better off powering through and multi-tasking eating my lunch while going through emails, sitting on calls (with my camera off) or cramming in some other task. But I loved the suggestions in this article and know that if I step away (even just for 10 min!), I’ll return to work calm, collected and ready for whatever the afternoon has in store. This is going to be my intention this week!
- I can’t stop making stovetop popcorn! When I first moved to Chicago, I would make stovetop popcorn as a budget-friendly snack all the time. I’d buy the popcorn kernels in the bulk section of the grocery store (one of my favorite hacks for anytime you need a spice or specific ingredient for a recipe – check the bulk section instead of buying a whole package!), make the popcorn on my stove, and season to my liking. In one of my moves to a new apartment, I lost the pan I used to use to pop popcorn and forgot about the snack. But I saw kernels at the grocery store the other day and instantly got a craving. I picked up a new pan too, and now I can’t stop! For a personal serving size, cutting this recipe in half works great.
That’s all for today! I hope you found something in today’s newsletter that sparked motivation, made you smile or inspired a positive Monday thought. Don’t underestimate the power of starting small… a fulfilling week starts with just one fulfilling day. You’ve got this!
Let’s make it a great Monday!
Megan
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