What is this Alchemy of Budgeting & Planning?
It's what you've been missing all along...
Simply having a mooch with my pooch, one of those “let’s see where this lane leads” kind of Sunday exploration, is gorgeous and does wonders for my wellbeing. However, living this meandering life on the regular, maybe not so much!
What I do know is that creating a strategic’ish pathway in your financial life can help you get to where you want to go more effortlessly than you realise.
I’ve learned over the years that planning eases my stress. It helps me to be more spontaneous and free to make decisions more simply.
I dislike flumping around directionless.
(Not the Urban Dictionary kind. I thought I’d made up this word. Seems I didn’t. I don’t even like marshmallows 👀)
Without some sort of plan, I just feel stuck in life. Groundhog Day. Innovation breathes oxygen into my life force, my creative energy centre so that I can live my one beautiful life with as much gusto as possible - for an introvert.
When I don’t have to keep all of life’s admin up here (*taps head & winks), I don’t have to worry about forgetting anything. It means I can be really flexible because I can move my plans, I can postpone, and I can carve out the best route forward via the many inevitable diversions. I’m not nose to bumper on the M25 commute; I’m happily pootling along a country lane, finding new places en route but mindful of where I’m meant to be going and it’s NOT into my overdraft.
Being stategic’ish means I ultimately know what I need, what I want to have, be & do. But I’m happy to go off-piste as long as I rejoin the plan further along the line.
It’s the missing piece that causes most people to loathe the seeming greyness of budgeting.
Living month to month, I found, was limiting and so inconsistent it was hard to create a comfortable lifestyle. Some months = beans on toast every day whilst others, I could delightfully place my posh goodie bags on the front seat & drive home smiling.
(La Rochefoucauld-en-Angoumois, my nearest town)
When I used to write out my expenses for the month, it was too late to do much other than react to what was going on, and I hated the feast & famine of it all.
Christmas is hardly a surprise each year, and yet I spent every penny I had in November & December to pay for it and ended up in my overdraft to add to January’s misery! Some people I chat with are still paying off their credit card in April for the previous Christmas.
Saying “I can’t afford it” all the time depleted my energy. I felt like I was always missing out; No, I couldn’t buy those tickets this weekend for next year’s big concert. No, I couldn’t just grab cocktails and a cab home after work, and yes, I really do need a spa day, but no, I can’t book one.
Taking control meant for me, a fresh approach.
When I stopped budgeting month to month I stopped living hand to mouth.
What is this alchemy, this sorcery that has transformed my life?
Not being a spreadsheet kinda girl is exactly the reason why I created one!
Why? Because I knew I needed to see it all laid out in front of me. I’d used A3 paper to craft a plan but I knew it would work so much better on an automated spreadsheet.
All. Those. Numbers… *shudders
There had to be a way, so I tinkered and created my perfect solution. It turns out others loved it too, so I’ve been selling them ever since!
Like a lot of things in life, it ain’t whatcha do it’s the way that you do it. You need to know what the spreadsheet is telling you to take action on and what answers it provides you with, otherwise, it’s just a load of numbers that you end up asking, “Now what?”. To me, anyway.
Creating a plan, cunning or otherwise, gives you your roadmap. Marrying up your roadmap to your finances and managing the process frequently is how the magic unfolds. Cinderella, you CAN go to the ball!
Here’s how I use my toolkit in 10 parts:
I can see my year ahead - I choose to do this Jan - Dec but of course, you can do April to April tax year or whatever floats your budgeting boat.
I chose to use each month from the 1st to the 31st, even when my payday was mid-month. It got to the stage where it didn’t matter when my money dropped in so any changes to pay dates didn’t confuse me. How? By having an overlapping buffer of £200 and a low-interest overdraft for the occasional dip.
When I’ve got my income laid out for the year ahead, I can then layer in all my essentials: mortgage, bills, car, food, etc. Mostly fixed costs but not all.
It’s wild how much this stuff takes up of the money you make.
Here’s how I contextualise it:
Mondays at work paid for my tax and national insurance (gross pay)Tuesdays, Wednesdays and Thursdays paid for my essentials, so Fridays were the days I worked to afford gorgeous things and savings. Trust me, this makes a huge mindset shift.
Now, I can see my annual salary and my annual cost of living broken down into months. I can then layer in my expensive seasons, the pesky 5-week months and the bonus months, e.g. where there’s no council tax to pay (Feb & March).
I now have a “what’s leftover” each month and for the year.
I can see now clearly how this fluctuates. And I can see how I can save some and spend the rest. And most importantly, how much!
When some things need to be paid for in advance, I can work out how to do that. If I want to book a holiday, starting with the end in mind I can work back to today & know how to save for it.
I can create a savings pot for those aforementioned expensive months: car servicing, weddings and birthdays so that it’s less financially painful.
I know exactly how much I have left to spend on things I want, and if a whoopsie happens, I know how I can pay for that. (Such as falling asleep on the train & waking up to see your fiancé staring in disbelief at you through the window, waiting on the platform to take you on a dinner date but instead watching you move off towards Canterbury… Taxi!!!)
I know what I can say yes to. I know how that “Sod it, I want it” purchase will affect me. Concert tickets for next year? Well, I know how I can make it happen if I really want them.
Creating a bespoke strategy makes me feel safe, especially when things go wrong.
Having this flexible plan gives me the feeling of being in control, which I love, and keeps me out of debt, which is the best feeling in the world.
When life feels like a game of Gladiators (or It’s a Knockout if you’re 50+), your financial wellbeing will be positively zen-like by comparison!
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What was most useful to you? Let’s chat in the comments.
Love this strategy!