How often do you open your banking app to check on your spending? Do you have a budget but want to save more for your goals? Budgeting is a topic that a lot of people talk about, but few enjoy hearing. There are so many different resources to teach us how to manage our money and while many of them are helpful, it's confusing to know where to start. Budgeting isn't just about saving for retirement. When we're young and single, we often are in a place of uncertainty in terms of our long-term plans and income. Our budgets also don't hold the same complexities as family budgets. So we tell ourselves that it's easier to just "be careful with our money" and put aside savings when we can. But I can tell you from experience; that strategy will leave you wondering where all of your money went.
As a creative who's bad at math, I'm learning how to make my budget straightforward and action-based. Simplicity is key to stay on track. I'll break down the steps for you so you can take them in stride.
Whether you get artsy in your favorite notebook or type it up in Excel, everything is clearer when you can visualize it. Write down your total monthly income, then deduct the bills that are absolutely necessary. Don't include your groceries or other estimates that can fluctuate. We'll look at those later. Only put down the non-negotiable bills. For me, that consists of rent, car insurance, electricity, and my phone bill. If you have minimum payments for student loans or credit cards, you can add that here as well. Once those are subtracted, use the number left over as your base.
Now, pause for a moment and forget about all of your financial obligations and wants. How do you feel called to give? The Bible tells us to give abundantly and also with a cheerful heart. It's not just about tipping 10% on Sunday. What ignites your compassion? There might be times when you are convicted to give above and beyond to a specific cause. So if you can, leave a cushion in this section. Don't give because you feel obligated to; give because you want to follow Jesus. Give in ways that reflect His love. If you're struggling to give, don't do it with bitterness. Instead, take some time to connect with God and work through what's holding you back. When money is tight, the Bible guides us on how to give even when we're broke. Giving is a lifelong journey, and God wants to meet you where you are at, not where you should be.
Now that you've subtracted the essentials, you have a picture of how much money you actually "have." The next step is to evaluate what you would do if an unexpected expense came up and you couldn't depend on your income to cover it. Do you have an emergency fund? When I was self-employed, this was something I had to prioritize. If you put $1,000 aside strictly for emergencies, that will give you a lifeline to have the freedom to save for other things. If you don't have that chunk at the moment, put aside whatever you can and build up.
Once I established my emergency savings I made long-term and short-term savings plans. Long-term is where I will gradually build toward my future, to have security when I have a family or make changes in my career. 10% is a good baseline for long-term saving. I've struggled with this commitment because my short-term goals feel more exciting. Still, I know that discipline pays off in the long run, and I don’t feel guilty about spending when I know I have investments in my future.
Short-term goals include things that have a foreseeable timeline, such as saving for a car, a house, or a big trip. Travel is more valuable to me than possessions at this point in my life, so that is what I throw a portion of my money at. What is valuable to you in your near future? In my written budget, I plan for 10% to cover my short-term goals. However, depending on the details, I usually have to calculate a more precise number to save enough by the timeline I want. No matter what you're saving toward, it will be a lot easier if you set a timeline and then budget the amount you will have to save each month to reach your goal. If it's more than you can afford, it's better to adjust your timeline than to tell yourself you'll "come up with the money somehow." This will leave you peace of mind and satisfaction when you do accomplish your goals.
Now it's time to see what's left to spend. Usually, our first inclination is to ask ourselves, "how much should I spend on _?" Well, that is not my approach. I think our first question should be, "how can I improve my daily life?" For example, do all those un-canceled subscriptions make you more productive? Or are they just digital clutter? The answer is probably the latter, and you can delete them from your budget. How do you want to eat? Will it improve your health and save time if you meal plan? Will you enjoy special occasions more if that's the only time you eat out? Do you spend a lot of time driving places that you don't need to? Look at your habits with quality of life in mind first and money second. Then calculate how you can carry out your lifestyle within your budget. My advice is to leave 5% for unexpected spending.
Instead of being afraid of what might happen, we should make the most of what we have now. As you go forward, review your budget every month and take accountability. It can help to have a partner that you share goals with. If you don't feel comfortable sharing your financial situation, you can encourage each other in your habits, and that will reflect on your budget. There are a lot of tools that can help you track your spending. One of my favorites is the "Expense Keep" app because it is simple and free. Find whatever works for you, whether digital or on paper, and make it a part of your daily routine.
Money is an essential part of our lives, but it is not where God wants our hearts to point. When we have our finances in order and put purpose behind the numbers, we have more freedom to pursue our calling and experience God in our everyday lives. God provides opportunities for us not to worry but have hope for the future.
Written Content Coordinator at Sun Valley Community Church. An avid writer since the age of 5, who loves to explore new ideas and places. Inspired by Jesus, books, and travel.