Do you light up 😇 or throw up 🤮 when you hear the word “budget?”

Where money is involved, there always seems to be strong emotions.

In my experience as a health coach, I have witnessed that money can be an enormous help or hindrance to fitness and general well-being.

I have seen this distinctly in the lives of the people I worked with. Some struggled financially. They were constantly stressed out by debt & the need to work several jobs to make ends meet. It was hard for them to take good care of themselves and meet their health goals because they were in survival mode all the time. They were constantly on the defense and crises were somewhat regular. Adding an “extracurricular” like health, was just too much work on top of everything else they were dealing with, and understandably so.

Others were financially well off. They could cut back on work if needed for the sake of their health. They could afford to delegate certain tasks, such as cleaning, so they could spend more time doing things that made them feel whole. They could afford exercise equipment and fresh foods. They lived without the stress of debt.

Please don’t misunderstand. If you are struggling financially, that does NOT mean exceptional health is out of reach. However, financial freedom can significantly turn the battle in your favor. For this reason, getting a financial plan in place may be the best place to start.

A woman I adore introduced me to Dave Ramsey’s Financial Peace University. She is a highly successful senior executive with great fashion sense and when she talks, I listen. My husband and I listened to the Dave Ramsey CDs she lent us (these are the old school versions, the course is now online) and learned so much. It sparked important conversations between us and really helped us get clear on our financial goals.

The Ramsey philosophy can mostly be summarized with his 7 Baby Steps, which are:

1. Save $1,000 for a starter emergency fund (even and especially if you are in debt)

2. Pay off all debt (except the house)

3. Save 3–6 months of expenses in a fully funded emergency fund

4. Invest 15% of your household income in retirement

5. Save for your children’s college fund

6. Pay off your home early

7. Build wealth and give

Financial Peace also got us going on the all important tool for money management and financial freedom - the budget. My hope is that in sharing my imperfect way of handling our finances, you can gain some tactical ideas for your own money and life.

With that in mind, here are some tips and tricks about creating a working budget.

The Simplified Budget

• In our home, we use the free Dave Ramsey budgeting tool called EveryDollar to keep track of our income and expenses.

  I have tried several apps such as You Need a Budget (YNAB for short), Mint, and Quicken, but have liked EveryDollar the best for creating a simple, user friendly budget.

• The first Sunday of each month, I create a budget by copying over last month’s budget (EveryDollar makes this incredibly easy).

  I then look over the month and talk with my husband to see what expenses we are anticipating -oil changes, birthdays, subscriptions coming due, etc. I adjust the budget to reflect those expenses.

• Every Sunday, I review our transactions for that week. I open a tab with our bank account, Costco credit card transactions, and EveryDollar. I then “balance” the budget.

  By that I mean that I see how much we have spent and adjust the budget if needed. For instance, if we had an unexpected car expense that cost $100 and I originally only budgeted $50, I will change the budget to be $100. This way, EveryDollar will show me how much I am over my budget so that I can then subtract $50 from a different area. Budgets are meant to adjust. The idea is that you adjust other areas to make sure you don’t go over on the total amount you are wanting to spend for the month.

  • Pro tip - I never use the actual date of each transaction when adding them to EveryDollar. Rather, I use the default date (which is whatever day it currently is). It’s way faster and easier.

• We try to be specific enough with our budget categories so we can see where the money is going, but general enough so that it doesn’t take forever to categorize everything.

  Here are the categories we use:

  • Home Improvement

  • Rent (after we buy a house this will be mortgage)

  • Gas

  • Car Maintenance

  • Tithing

  • Groceries (this also includes diapers, wipes, formula)

  • Restaurants

  • Phone

  • Fun Money

  • Hair/Cosmetics

  • Babysitter

  • Miscellaneous

  • Life Insurance

  • Renter’s Insurance

  • Auto Insurance

  • Spotify Subscription

  Additionally, we have different savings buckets for a down payment, Christmas, etc. Before we bought our last car (with cash), we also had a category for “new car” that we would put money into each month.

• The first time you create your budget, you likely will not know how much to allocate for each category. It can be easy to become paralyzed by this.

  Make your best guess and adjust as you learn.

• Each month, we budget a set amount of money for myself and my husband. This rolls over each month.

  I highly recommend this practice, even for tight budgets, because if you try to “save everything” you almost always end up just giving up. This way you still have some wiggle room to satisfy and keep a shopping craving controlled. Plus it’s just fun to have your own pot of gold.

• In the past, we used credit cards for all expenses for the sake of rewards.

  We paid them off each month and never carried a balance. A cousin introduced us to an awesome American Express promotion where you can sign up for a free trial of their platinum membership for a year, spend a certain amount, and receive anywhere from 40-90K of free sky miles.

  However, I found that reconciling our budget with the credit cards was a hassle.

  For that reason, we stopped using our American Express cards about a year ago (though we still have them). We do, however, own a Costco credit card and use it for Costco expenses only. I treat that card as a debit card. Each week I go into the credit card transaction list and track expenses, even if the card hasn’t yet been paid off for the month.

• We created several different sub-accounts besides checking and saving in our bank account.

  For example, we have an account for tithing, mine and Brenden’s personal spending money, and for our down payment. We have created automatic transfers as well so that a set amount can go to these categories each month. It’s slick and easy. Usually you can set this up yourself online, but you may need to contact your bank.

Of course, there is so much more to life than money. As the adage says, “the best things in life aren’t things,” and that’s true. My greatest treasures are made of people and experiences, and I bet yours are too. However, wise money management can help you take care of the basic needs you and your family have. This will enable you to to focus on the more beautiful and impactful things in life and achieve greater health and satisfaction in life, if you so desire.

Budgeting has been one of the most important activities for my marriage. It aligns me and my husband regularly. It creates a culture of trust, transparency, and open communication. It has helped us identify how much to spend on housing, cars, and how much we needed to negotiate to earn in our careers. Good luck on your journey. I know it isn’t easy, but it can be simple. Happy budgeting!