personal finance 2021 (adulting 101)
How would I budget or keep on track with my finances as a working student and helping to my family's expenses yet feel fulfilled?
First things first,
I should "reward myself first". So, what are the example of that?
For example:
- the book that I am eyeing for a long time
- travel that I am planning in a budget-friendly way
- stuff and things such as clothes, shoes, supplies, and others
- services that I want to experience such as diode laser, massage, hair improvements.
- household stuff
It should be noted that these are some examples but not limited to them. It also depends on your wants and needs as an individual. Note that rewarding yourself doesn't have to be that costly. If it requires so much money you can change it by what you can afford for now. As for me, those traveling and clothes are not that my priorities so I will modify my "reward myself" program to my school supplies stuff, then next month if my income can afford a diode laser I will purchase it. Rewarding myself might be around 10 % only of my income.
Secondly,
Savings.
Our savings is very dependent on our situation.
It also depends on our monthly expenses because if you're helping your family and independently providing yourself it's surely hard to save and budget it. In my situation right now, I will try to at least save 30 % of my income for this season of my life. Due to my ongoing schooling, I think it will be hard for me to save because I am also paying my tuition fee and other expenses for my university. So, the goal is to find a scholarship (praying for it!!). Save slowly but surely.
Right now, I will set my savings in two categories such as general savings and emergency funds.
Thirdly,
Expenses. Under expenses, there are also sub-categories for it.
Debt - Paying debts. If it cannot be paid in full, make sure to pay little by little ( snowball method). It shouldn't be disregarded as an expense because the money we borrowed is also important to them. Paying for our debts projects us a credible person and builds integrity when a person sees that you're sincere to pay for that debts. Also, for us to have peace of mind. As much as possible if we can be free from bad debts, do it!
Fixed monthly expenses - these are the house rent, internet, gas, insurances, tuition fee, and any expenses that have a fixed amount to pay monthly.
Variable monthly expenses - such as electricity, water, dental, groceries, personal care items and others that amount varies but need for monthly expenses and not wants.
Other expenses - such as tithes or donations, tips, entertainment, eating out, fare, body and hair care/services, other hobbies, clothes, and any other that are included in our wants.
In my situation, I will add School Expenses such as books, uniforms, fees that the school requires, organization membership fees, and many others expenses that involve my education.
With this, I will set my expenses to 60 % of my income.
Self - programming
Be reminded also to become a realistic, discipline, and have objective views in spending our finances.
Be realistic because, in my experience, I set my savings to 40 - 50% of my income wherein it's very hard to impose because at that time I am the one who paid for all of our family expenses (when COVID-19 strikes). With that, it makes me frustrated because from time to time, I withdraw some money from my savings because I need to pay for certain expenses.
Be disciplined as much as possible because it will be our only accountability to achieve our goals in the aspect of finances.
Have objective views because sometimes with the influence of our emotions we tend to be confused that our wants are considered needs. It's okay to purchase our wants but be also reminded of our responsibilities, priorities, and goals. When we are in the situation of being tempted to add to cart on our online shopping, just let those things be on the cart for 7 days and go back with it. If you feel the same way as you add to cart it then buy it if you still have a budget for it.
Disclaimer:
This is based on my situation and my personal experience. Please be also guided that budgeting our finances are greatly dependent on our situation and priorities. We should do what works for us. Also, in the future, this kind of handling of my finances may vary depends on my situation in the future. That's why most of my statement includes "for now" or "right now".
Lord, guide me to properly and wisely budget my finances. Remind me to glorify you with the blessings I received and will receive from you. I pray for a full mastery of handling my finances and my emotions towards my spending habits. I know you are the best provider and please make me reminded of that. I trust that you will provide and you already know what we need. I believe that if it's Your will, it's Your bill. Amen.
