A MONTH IN MY PAY

Money does not grow on trees and wishes don’t come true by just daydreaming about them.

Being a family guy has its own obligations while being a single and young man requires different yet compelling things to worry about. It is always a pendulum moving to and fro from needs to wants and vice versa. There is always a peer pressure to be cool and enjoy your life for the time being. And then there is family and societal pressure to make you aware of the ongoing race to have a better future.

Creating a Budget

Setting a budget is helpful to make you gain your financial goals; long-term and short-term both. Setting practical and easy going goals make it possible for you to keep your budget rather than making changes in it with every new pay cheque you receive.

What helps you the most in this regard is to make a plan which consists of intelligent decisions while spending. Know your income that you take home and keep a track of your spending. I personally kept a diary to note down every single penny I spent during the first moth and later made notes on my phone when it got difficult for me to keep a diary. After the first month, I went through the list of things I bought and the services I paid for. Its review helped in making decisions for my next month’s spending. Reflecting through your list will help you identify your purchases that you made just for the sake of spending. And believe you me, we all do that! Keeping a balance between expenses and spending is the key.

It’s Always Needs v/s Wants

Some people receive their pay on daily basis, some weekly, and some monthly. Most people wish for a steady life style without having to worry about facing a budget crunch. Well, it takes efforts to mend your habits to meet your financial goals. Cutting your hard-to-part want expenses may be the first step in this. And the sense to do it isn’t something in-built in all human beings. It requires a thoughtful process about your priorities and willingness to either submit to or overcome your temptations.

You love to have a fun night out with your friends and watch a movie in cinema, that’s what you want and paying your rent is your need. Have a clear distinction between your needs and wants and then start cutting on what you can. I mean movie night at home with friends won’t kill the fun.

Mini Pays in One Pay

First things first, determine your fixed and variable expenses. The money left after paying your fixed expenses such as rent, gas and bills, you may like to make a list of expenses that may change from month to month.

The best advice I learnt about creating a budget was to split your pay into percentages and name those mini pays as different expenses that you may or may not do in that month, but do it anyways as you might need that particular mini pay in coming months. This mini pay will be counted as a short-term saving goal for any much awaited need of yours. My pay in a month goes on these things:

· Grocery

· Clothing and accessories

· Charity

· Health and meds

· Gifts

· Skincare and toiletries

· Savings

I have made envelopes tagged with the above mentioned categories. I split the remaining pay after paying my fixed expenses and put in the respective envelopes. It has helped me in gaining satisfaction that I can achieve goals. In case 20% of my pay that goes in the clothing and accessories envelope is not required for month 1, it gets saved for the next month, or I save the same amount for six months straight and shop for the next season in month 7.

The percentage of your pay that goes in those envelopes is entirely dependent on one’s own choices and preferences because at the end of the day it’s your hard earned money and you get to decide what to do with it. You may make bad decisions at first but what’s a life without mistakes?

Things You Might Want to Learn:

· Using cash in hand and not your credit card may help you avoid financial stress.

· Always review your expenses.

· Increase in income should motivate you towards saving goals or making investments not towards increasing your expenses.

· Always try to enhance your financial literacy so that your money could work for you rather than you always working for money.