Most people often find themselves at some point wondering: "Where did my money go?" Whether it is your whole spending plan for a month, or the cash allowance in your wallet, it's easy to let money slip out of your life.
While being hypervigilant about your money is a good way to get back on track, it's also exhausting. So in addition to using a spending plan, here are a few low-stress ways to be more intentional about your spending.
1. Figure Out How to Stay Focused
It's hard to get somewhere if you don't know where you want to go.
Financial goals are a key part of a financial plan. No matter where you are on your financial journey, goals give you something to work toward. Maybe you just want to make it through this month without adding to your credit-card debt, or you're actively paying off that debt, or you're building savings for a future purchase: Goals are the motivation to say no to things that aren't important to you.
Pick the most important financial goal you have right now, and find ways to incorporate it into your daily life. Make it the password to your computer. Make a graphic and set it as your phone's home screen. Write it on a Post-It note and stick it to your bathroom mirror.
2. Be Realistic About Recurring Expenses
One of the likeliest ways to let money slip away is spending on things that aren't planned for in a specific way. I'm talking about expenses you can anticipate, such as buying gas for your car or new tennis shoes for your growing kid.
I'll share my failing in this department: I don't have a separate place in my spending plan for clothes. I used to, and then I figured that we were good and it wasn't necessary. The evidence suggests that I am wrong.
With six people in our house, clothes spending can be from zero dollars a month to several hundred dollars a month. I am basically deluding myself that we don't spend on clothes and that we always shop at thrift stores. Even thrift stores can add up! I dropped $50 at Goodwill last month, and because I don't have a place in my spending plan for clothes, this comes out of general spending funds.
That's just disorganized and unhelpful.
If it is something that you spend money on more than three or four times a year, put it in your spending plan. I don't care if it is fast-food sodas or new software or travel; plan for it.
3. Build in Some Guardrails
Guardrails help keep you on the road. Financial guardrails help you stay on your spending plan. The two main ways I use financial guardrails are either a) time or b) dollar amount.
Let's say you have budgeted $50 a month for your favorite coffee shop. Instead of mentally trying to remember how much you've spent, take control. Move $50 to your spending card in the store's app on the first of each month.
Being intentional lets you be in charge of your money, instead of your money being in charge of you. You can enjoy life within a financial structure that you've created. That's not only a lot more successful, but it is also a more comfortable way to live.
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