Most people have a loosely defined money management system, but having a clear system in place can give you more confidence and less anxiety around money.

The Benefits of Creating a Money Management System

Most people have a loosely defined money management system, but having a clear system in place can give you more confidence and less anxiety around money.I don’t like budgeting, as evidenced by the facts listed out in this post.

I spend my money based on my values, and I save the rest.

This technically works because saving money is second nature to me. I question all of my purchases automatically.

It might sound crazy, but hey, that’s just how I function.

Because of that, I have a somewhat loose hold on my money management system…actually, I don’t really have a system.

And that can be problematic for a variety of reasons.

Yes, spending according to my values has been helpful for me, and I’ve still been saving money as I always do, but I wasn’t aware of how much…and that led to doing nothing with it.

“Okay, you still have a bunch of money saved up, why is that bad?”

I’ll tell you.

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Value-based spending has so many advantages, both for people who have trouble controlling their spending and those who are super frugal. Here's why.

How Value-Based Spending Improved My Relationship With Money

Value-based spending has so many advantages, both for people who have trouble controlling their spending and those who are super frugal. Here's why.It’s interesting how my views on money have evolved since starting this blog.

I’ll admit that I used to be very heavily on the “frugality/cut all the expenses” bandwagon. I hopped the fence between being cheap and frugal quite a few times.

At times, my relationship with money was so bad, I felt like I needed to hoard it all. I was super protective of my bank account, which proved to be detrimental in a lot of ways.

Why? Because I was saving my money out of fear, and fear is a powerful motivator when it comes to money.

Fear of ending up destitute can motivate us to save.

Fear of missing out can cause us to go into debt.

Fear of losing our life savings can keep us out of the stock or real estate market.

Ultimately, acting out of fear isn’t healthy. In my case, I was letting money control me.

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December Budget Preview - Journey to Saving

December Budget Preview (and How We’re Managing Our Finances)

December Budget Preview - Journey to SavingI am back with a preview of what December’s budget is going to (hopefully) look like!

We’re looking to take it easy this month, especially as we’ll be staying with my parents for 6 days surrounding Christmas. My mom has a feeling she’ll be working like crazy, so I plan on taking my own work with me and relaxing around the house.

Since there’s not much to say here, scroll down if you’re interested in reading about how we’re managing our finances. I’ve received a few questions on the subject and thought it was worth mentioning.

You all know I strive to be as transparent as possible around here, and I realized it was kind of silly not to address how we’ve been handling things since my freelance income isn’t quite where my full-time income used to be. It’s getting there, though!

December Budget Preview

Debt: Whoa, what’s $1,500 doing there?!? I had hinted at the fact we were possibly ready to make a big payment toward our loans, which is what spurred my student loan update last month. So I’m throwing it in here to be held accountable. We’ll still pay the minimum toward mine.

December Budget Preview Spreadsheet DetailsHousing: Same old story here! We sadly weren’t able to stay under $60 for electric like we did last month. Our electric bill actually states “the weather raised your bill by $8.” Thanks, mother nature. Our water bill also went up a tiny bit, but at least we’re staying under $30 there.

Food: I am sticking with $275 as again, we’ll be at my parents for Christmas, and I’m very grateful they feed us. I’ll probably contribute a little if my mom allows, just because that’s a lot of meals!

Ironically I wrote this in my draft: I don’t think we’ll need any household related items, but I’m leaving the $15 in from last month as we ended up with a few surprises! And of course, a surprise popped up. So I hope nothing else does!

I’m keeping restaurant spending low to account for our $5 Food Lion pizza every Friday (mostly R’s “treat”). If you have one around you and normally pay more for a pie, try it out! It’s huge and pretty tasty. Other than that, we don’t plan on dining out.

Transportation: I’m also keeping gas the same, as this month should entail the same amount of traveling as last month. Hopefully gas prices keep going down!

I’m throwing the $150 for the car back in here just in case we do make time to take the car to a mechanic, or do a tune-up ourselves. I’m not sure exactly how much the parts will cost.

We’re paying R’s car insurance premium in full, and mine was paid last month, so I don’t owe anything!

Misc:

Cats: They need food this month and another box of litter.

Gifts: Pretty self-explanatory. My family is horrible at telling me what they want ahead of time, so yes, I have to wait until December to do Christmas shopping to ensure I get them things they actually want. Because of that, I also don’t have an amazing idea of how much I’ll spend.

I do have a limit (i.e. I’m only spending X amount on this person), but when it comes to my parents, it’s hard to say no. They gave me so much growing up, and I want to repay the favor. The only reason I mention this is because my dad is getting the “upgrade computer” itch, and is requesting some more expensive items. My mom and I will be splitting those.

We actually went grocery shopping last night, and while there, Harris Teeter was having a stock up sale on k-cups – 5/$25. I was going to get my parents a huge pack, but I decided to go this route instead! In total there’s 60 k-cups, so I thought that was decent, and it allows me to give them a variety to try out.

Ring: I’m adding this back in here, but I’m not entirely sure we’ll have enough time to fit this in. Thanks to everyone to offered advice in my last post – I’m hoping to find someone who knows someone and can recommend an appraiser and a jeweler. =)

Personal Care: This should be pretty low, seeing as we got most of those expenses out of the way last month.

How We’re Managing Our Money

Since I’ve been freelancing, managing our money hasn’t been the same as it was before, and I wanted to give you all a little insight into what we’re doing.

We’ve always had a checking and savings account with our bank, so that hasn’t changed. I would really like to have a bank that allows multiple savings accounts, as I’d like to label our different savings categories (wedding, car, cats, travel, etc.), but for now, it’s all lumped in together.

To cut to the chase, we have a big emergency fund. I knew we would need it when we moved because I was either going to spend time looking for an actual job, or I was going to rough it out as a freelancer for a bit.

So we’ve essentially been living off of R’s income and our savings since we moved. It’s not an amazing position to be in at all, but we knew this would be our reality for a bit.

What’s going on with my freelance income? Freelancing is a different beast because it’s not steady, and I have to account for taxes.

The majority of my freelance income is separate from our personal money (makes sense), and I use PayPal for that, though I’m looking into opening a business checking account. I’m not thinking of it as “regular” spending money right now because I have no clue how much I’ll owe in taxes.

So all in all, when we go to pay the bills each month, we use what’s in our checking account. My freelance income is totally separate and only gets touched to pay for business related expenses (I don’t take it out and use it for groceries or anything).

Because our emergency fund was good upon relocating, we had already technically met our savings goal (this was before we got engaged). We have a healthy amount in there, which is why I feel comfortable putting $1,500 toward our student loans.

Those are now our full priority, unless we have a huge emergency that drains tons of cash, in which case, we would focus on building up our savings again.

Ideally, my income will grow even more, and thankfully it’s gotten to the point where we are saving money each month. I’m hoping it’ll go up significantly by April, and we’ll be able to resume saving for the wedding on top of paying off our debt.

We’re also hoping R will receive a raise at some point, but he’s going to start side hustling as a graphic designer, so we’ll see! If he can earn at least $400, we’ll be able to double our student loan payments!

How much have you budgeted for presents? Do you save ahead of time or buy ahead of time? If you’re a freelancer, how do you handle your finances?