Are budgets your B*!%$ or your BFF?
Are budgets your B*&%$ or your BFF? Finding freedom through financial boundaries.
Last week on my Instagram stories @sherylwright_ I asked this question: Are budgets your B*&%$ or your BFF? More of you responded to this question than ever before, so it feels like I may have hit a nerve?! And not surprisingly, the majority of you who answered (72%) said that budgets are definitely your B*&%$. For most of my adult life I would have answered the same way, but I am making a major shift, step by step, and turning that B*&%$ into my BFF and want to share some of the ways I'm doing this.
Money has all kinds of emotions tied to it, so naturally budgets do too. The thing is, most of us were never taught how to have a healthy relationship with money, let alone budget effectively. As a young girl growing up on the outskirts of Portland, Oregon, I was strongly advised by all kinds of trusted adults to never discuss money, sex, religion or politics. What?! This left me making small talk about the weather, sports, movies and music, and searching for answers about the important forbidden stuff by myself as a naive twenty-something in the age before Google?! I got some things right, but have mostly learned through costly mistakes - can you relate?
So how have I changed my relationship with money and budgets? The key word here is "relationship". The first step for me was acknowledging my emotions around money. Once I did this, budgets became easier because they provided clear boundaries around my investment and wealth creation goals, and showed me how my spending habits (read "retail therapy") affected those. Here's how I've found a friend in budgets:
Identify your top 5 core values
I sit down at the end of every year and revisit my core values, for myself and for my business. This past year my core values shifted dramatically. Finding myself on the other side of breast cancer, pandemic and divorce shifted my perspective on all kinds of things, so naturally my values shifted as well. I've started doing this core values exercise with my young adult children, and you better believe that when I find myself in a relationship again, I'll be doing it with my partner as well. Here are a couple online resources that I have found to be helpful:
Brené Brown - Living into our Values
Core Values Index
My personal core values are: Self Awareness, Leadership, Freedom, Community and Joy. My core values for Dare to Detour are: Community, Inclusivity, Resilience, Adventure and Leadership. Not surprisingly, there is some overlap - Leadership and Community - but I approach them differently depending on the context and whether I'm making a business decision or a personal decision. Knowing my core values has made decision making more efficient and effective for me across the board, especially when it comes to making money-based decisions.
Get organized
Organize your monthly bills and financial statements from your banks, credit cards, 401K's, IRA's, real estate, and any other investments you may have. Tidy up your filing system and make sure you have access to at least 6 months of expenses. This can be an overwhelming task, especially if it's not something you've kept up with or do at all. Give yourself the time and space to dive in. I recently did this and it took me the better part of 2 days to sort through everything, temporarily consuming my kitchen table and spilling over onto my countertops.
List all monthly subscriptions
Once you've identified all your monthly subscriptions, list them in order of their priority and meaning to you. If there are some that you can cancel without hesitation, do so. Sit with the rest and consider how / if they support your core values. If they don't, cancel them too.
Drink that latte!
By rationalizing your monthly subscriptions - I was shocked at how many I had?! - you save much more than you ever will by cutting out small daily pleasures, like that lavender iced latte. Allowing yourself simple pleasures has an amazing effect on your mindset and supports you in sticking with your primary budget and financial goals over the long term. I say if a lavender latte gives you joy, go for it and be sure to share with a friend!
Clear the energy and add beauty
Wait, what?! What does clearing the energy and adding beauty have to do with budgets? It has little to do with the actual task of budgeting, but a whole lot to do with how you feel in the space you choose to work in. There is a direct correlation between how you feel and how effective you are during the time you set aside to budget. So tell me, is your chosen space well lit by natural light? Are there elements of nature - rocks, flowers, shells, antlers, plants, etc - that help ground you? Is your work surface clean and clear? Can you open a window and allow the breeze in? Do you have a candle you can light? What about music? Is there room for your pets to join you at your feet? I always burn sage and palo santo to clear out any stagnant / negative energy and invite in abundance every time I sit down to pay bills or work on my budget and finances. Remember, we are working to make our budget our BFF, so prepare and treat the space and the whole experience like you would when spending time with a close and trusted friend.
Use a spreadsheet
This is where budgets have really been a B*&%$ for me - spreadsheets make me wanna vomit, so I have never really embraced them, rather have approached them with a lot of skepticism and at times, dread. I shared this dread with my financial advisor. She really listened to me and sent this template to me: (link is attached below) When I opened this spreadsheet for the first time, I found the layout to be clear with a real sense of flow, and it struck me as aesthetically pleasing. A lightbulb went off for me - as weird as it may sound, I need things to make sense visually in order for me to actually want to sit down and focus on the numbers. This template is organized with clear categories that are highlighted in green which makes it easier for me to read and work with (vs a monotonous excel spreadsheet). I am currently in the process of using this spreadsheet to gain clarity around my fixed costs, and to look towards the future and plan for any unforeseen events AND for fun, family travel, solo travel and retreats. Facilitating this forward thinking and planning is what has me warming up to spreadsheets. I definitely don't dread spending time with them like I used to, which is HUGE.
Want the exact budgeting template that I use? Submit the form to access the link and start using the spreadsheet for yourself!
Set aside a specific time each week to focus on money
Tuesdays are money days for me. I pay bills on Tuesdays, meet with my financial advisor on Tuesdays, and set aside time to review and revise my budget on Tuesdays. I work to keep this day clear of all other distractions and unrelated calls and meetings. This is a relatively new thing, making Tuesdays money days, and it's working for me. I invite you to try it and see if it works for you.
Work with a financial advisor
The best thing I've done for myself this year is to find a financial advisor that I trust - Harriet Chase with Aspen Grove Advisory Group. I mention Harriet by name because she has become a true friend and confidant, and has been the key in supporting me shift my relationship with money. I wish I had involved Harriet more fully in my divorce before I was at the tail end of the whole process, as she would have been a tremendous support throughout. She is, however, proving to be extremely helpful on the backend as I manage my settlement and plan for my future. She is also supporting both of my young adult children, in setting financial goals, and planning for their futures. There's a misplaced belief that you need a lot of money to work with a financial advisor. The truth is, good advisors are in it for the long haul and want to work with you early on so they can support you in building wealth and help with estate planning throughout all the stages of your life. I wanted to work with a woman and feel fortunate that Harriet is such a good fit AND lives in my town. It's worth vetting several advisor options in where you live to make sure you find the right fit for you and your family.
Other online resources I love…
Zoe Financial is an online service that can help connect you with the right advisor and the right fee structure. Harriet's fee structure works for me, but do your research and know what's available to you.
Ellevest is a financial company built by women, for women. Their single mission is to get more money into the hands of women. If you're not sure about working directly with an advisor, check out Ellevest and all the online services they offer.
Mark Matheson’s Core Values Index. An online assessment tool that helps you discover some of your core values. Plus, it’s free and takes less than 10 minutes to complete.
Brené Brown’s Living Into Our Values worksheet. This is a values exercise PDF that in my opinion, is way better than any New Year’s resolution you could do.
I also recommend that you follow women in finance on Instagram. Ellevest is on the ‘gram @ellevest and so is Tori Dunlap @herfirst100k. Tori has been called "the voice of financial confidence for women." Both feeds offer daily insight and advice and make all things money-related much more approachable and engaging, kinda like your BFF!
Find freedom through financial boundaries
Just like setting clear boundaries with your BFF can help the relationship grow in a healthy way, using budgets to set clear financial boundaries will ultimately provide you with greater freedom. Not sure why it took me so long to realize this for myself, but I see it now and am using my budget to set clear goals and make sound decisions with the intention of adding more adventure and joy in my life.
Your Budget = Your BFF
Do you prioritize self care and solo travel for yourself? If you have a handle on your budget, are the things that give you joy included? So often we don't prioritize ourselves or give ourselves permission to pause, to step away from our day-to-day and retreat, find adventure through solo travel, and reconnect with ourselves. Knowing my values and having confidence in my financial position has provided me with a freedom I didn't know was possible. Having a positive relationship with money and actively budgeting supports me in making better decisions across all aspects of my life, which feels damn good. Yep, my budget is my BFF
For the 28% of you who responded to my unofficial Instagram survey and said that budgets are already your BFF, what's worked well for you? What have I missed? Can you offer any other suggestions to improve the relationship we all have with money? Do you engage in money talk with your family and friends? Are you teaching your kids how to budget? Do you work with a financial advisor? I would love to continue the conversation here and on the gram with our community and beyond, because the more savvy we all become with our finances, the more good work we will be able to do in our families and our communities AND the more freedom and adventure and joy we will have in our lives.