Perhaps the most persistent myth when it comes to money is that budgeting is going to restrict your money. The idea seems to be that if you start trying to stick to a budget, you’ll never have fun again. Budgeting ruins lives, just like Regina George.
I think this is complete nonsense. It probably derives from our capitalist overlords who don’t want you to look to closely at your money, because then you’ll notice how fucked up the system is.
But here in this corner of the internet, we already KNOW how fucked up the system is. And so we are ready to be budget ninajs! To take back our financial power! To harness the power of budgeting to live incredible, happy, lives!
As you may know, I am a die hard budgeter and have been for years. Budgeting allowed me to pay off $18,000 in student loan debt in just ten months. It’s what has allowed me to become an aggressive investor. Budgeting has changed my entire life, and I will die for it.
Paying attention to your money allows you to control your money. It puts you in the drivers seat. A life without budget is a life wondering where your money went that month, or feeling frustrated that you didn’t manage to save any money AGAIN this month. Setting up and sticking to your budget gives you the freedom and control to say ‘I know that $500 went to debt this month, $75 went to savings, and $1,500 went to my living expenses.”
This control is why I made the Bravely Values Based Budgeting Workbook. It walks you through identifying your spending triggers, your financial values, and what financial freedom and security look like to YOU. You get to dictate your own money. This is the workbook that helps you flesh out what you want your money to do, and then start a budget that works for you.
ANYWAY, here are three specific things that paying close attention to my money via budgeting has allowed me to do.
Taking 3 Months off From Work
In 2018 I took three months of vacation, and it was glorious. I did almost no work. Yes, I maintained the Bravely social media accounts and checked my email, but I didn’t do any freelance writing. I didn’t pitch any Bravely products. I didn’t host any Bravely events.
What did I do? Mostly I traveled and slept, and I watched a lot of tv. I spent two weeks in Canada. There was a month spent traveling slowly throughout New England. I housesat in the middle of nowhere for two weeks. I went to Portland OR.
After three years of very frugal living (in order to build Bravely and make up for lost time when it comes to my own investing and saving), I was feeling really burnt out. I needed a break, and I needed it in a very deep, ‘I am really re-setting my whole damn life’ kind of way. One week wasn’t enough. A weekend full of sleep and face masks wasn’t enough.
But taking three months of vacation wasn’t just something that happened. It was something I budgeted for. I saved aggressively in the half of 2018, so that in the second half of the year I could take time off. I made sure to max out my IRA before I took time off, so that I didn’t have to try and save when I had very little money coming in.
What’s the common thread here? PLANNING. I had the money to pay for my life when I decided to take my time off. And that was all due to budgeting. For five months I tracked every penny that came in and then doled them each out to the bills and personal savings accounts that I needed and wanted to fund.
And boom. I was able to step back from my life for three months without disrupting my income or putting myself into debt.
Bravely is now three years old, and it’s amazing to me that this is my full time job. I’m a one woman show, meaning I do everything from answer all the customer service email and creating all my Instagram content, to writing up my own contracts and writing all these posts.
Bravely was born out of my desire to create a place to talk openly about money, to learn actionable money tips, and to help women feel more welcome in the money conversations in our world.
But PRACTICALLY speaking, Bravely was born out of budgeting. Bravely is entirely self-funded. I started this company with $3,300 that I saved from my catering side hustle and the sale of an old blog. I had to start a budget for my personal finances, and stick to it to make Bravely a reality.
More on how to start a business on a shoestring budget
Budgeting is what allowed me to both save the initial start up capital and to manage Bravely’s finances in the first two years. I was (and am!) a very lean company and I couldn’t afford to waste one single dollar. Budgeting my business finances was different in some ways than my personal finances, but I used the same skills to manage it all. (You can grab a free business budget spreadsheet here!)
Saving For Retirement
I freaking love saving for retirement. I LOVE IT.
Because I love my future self. Because I know someday I’m not going to want to work as much as I am right now. And I know that by saving and investing my money now, I am doing future Kara a huge solid.
And guess what??? BUDGETING MAKES SAVING POSSIBLE!
I know, it’s crazy right? Tracking your money and sticking to limits in all your spending categories means you can set aside money for your savings and investments!
For the last four years I have been able to max out my IRA ($5,500/year in years part, $6,000/year starting in 2019.) I’ve been able to open and fund a solo 401k.
And I get the money to invest in these accounts by BUDGETING. By saying ‘I’ve got $150 a month to pay around with. I’m going to allow myself $75 for meals out so that I can also allow myself $75 to put into investments.’ When you start a budget, you’re telling your money what to do. And I tell mine to go to work for me, via investments.
More on saving and investing
I didn’t start investing until I was 27, which is fairly late for someone who wants to leave work before traditional retirement age. Starting a little late means I have to do more investing and saving NOW, so that I can leave the workforce earlier than expected.
Budgeting has made that possible. I’ve been able to quadruple my net worth in four years due to consistent saving and a bull market.
In Sum: Budgeting Is Metal AF
To sum this whole piece up, budgeting is the best thing in the world. In no way does it mean deprivation. Budgeting means freedom. It means control. It means doing whatever the fuck you want with YOUR money.