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You’re working your butt off, picking up extra shifts at your job or hustling hard at your freelance gig. It’s not like you’re out every night dropping hundreds on blow and hookers – you’re just living a normal life, spending normally, doing what normal people do.

But every time that Friday paycheck rolls in, it’s spent by Monday. Where does it go?

This was me. Throughout my twenties, I made really good money. I had a full-time job where I got regular raises, plenty of overtime, had insurance (not great, but better than nothing) and overall I was doing better than average for a person my age with only an Associate Degree. I made more money than most of my friends and literally everyone I’d ever dated.

But still? I’d get paid on Friday morning, pay all the bills I had due, if I had enough to do that – and by Monday morning I’d look at my checking account and wonder how the hell is was possible that I was broke again.

Sometimes I had to decide which bill to pay and which I was going to let go late. That’s a shitty feeling. Afterall, I still had to pay for all the other stuff – the groceries, the gas in my car, feeding my pets, and all the other incidentals of every day life.

I was making a good living but through some foul sorcery, my money was always disappearing and I was barely affording my life.

I realize this is far removed from “poverty” – I still had a roof over my head, a car, clothes on my back, so I’m not for one second comparing myself to people who are actually, truly poor. This was just shitty money management. A state of middling, perpetual brokeness where I’d find myself eating mashed black beans on toast for dinner on the Thursday before payday because I hadn’t managed to make my money stretch quite far enough.

I let it go on for a long time. It’s actually pretty embarrassing now to admit how long I avoided really looking at my financial situation! Money is scary and stressful! Especially when you know in the back of your mind that, if you sit down and do the math, the number in the expenses column is going to be bigger than the number in the income column. Sometimes it’s just easier not to look.

Today, I’m going to tell you how to figure out if you’re actually making enough money to afford your expenses, and the first three things you should do if you’re budget-negative or just scraping by.

This is by no means everything I did to get my spending under control, but these are the first steps – they’re the simplest to tackle and make the biggest, most immediate impact.

Anyone can do these things – and you’re here because you’re a badass who wants to get their shit together, so you definitely can. And while they won’t make you rich overnight, they will give you some valuable breathing room in your budget.
Breathing room in your budget is INVALUABLE. Here’s how you make some. Click To Tweet

Start Here: Figure out your Expenses vs. Income.

This is the easy part, because it’s all facts and numbers and it’s less emotionally taxing than making decisions. You should make a list of every monthly expense you have. Include your mortgage or rent, utilities, car insurance, magazine subscriptions or gym memberships – everything you can think of that you get a regular bill for. Then you need to compare that number to your income.

I’m hooking you up with my spreadsheet to make this easy on you. Click below to receive it via email. This is what I actually use (and yes, those are my actual numbers with the exception of my income, which varies). All the instructions are in the spreadsheet. It’s in Google Drive, so if you have a Google account you can make your own copy by going to File > Make a copy.

This sheet is going to tell you a few things:

  1. How much you actually need to make per month based on your current expenses.
  2. How that compares to what you actually make.
  3. How much is left over after bills to pay for groceries, gas and everything else. This is the most important number, because if there’s nothing left, you’re budget-negative. That means there’s no money left for you to eat. That’s a problem.

So if that last number – the money that’s left over after paying bills – is zero, negative or just not very impressive, continue on. These are the first steps you should take.

1. Figure out what you can do without. Be ruthless.

You should only spend money on two categories of things: necessities and things that align with your values and priorities. What are you paying for that’s totally optional and doesn’t make you super happy?

What are you paying for that you could replace with something cheaper? Could you cancel your magazine subscriptions? Could you find a cheaper gym, or just go jogging at the park instead? Are you paying for duplicate services, like maybe you have AAA but your auto insurance also covers towing and tire changes? Do you really love cable TV? Does it align with your priorities? Does it make you super happy, or is it just something that fills the time?

Here’s what you’re going to do:

  • Make a list of all your non-essential regular spending. Be real about it. Electricity is essential. An Xbox Live membership is not. That goes on this list.
  • Pick out the items that are obvious bullshit and cancel those immediately. You probably don’t need Netflix AND Hulu AND Amazon video. Pick one. Cancel two.
  • For the stuff that is really, truly important to you – find a less expensive option. For example:
    • That gym membership – my local high school opens their gym to the public certain days of the week FOR FREE. I also workout with a couple of strength training DVDs that I got for $8 a pop, and I can run at the park for the low low price of nothing.
    • I cut my cable and replaced it with Netflix. Cable did not fit into my priorities – I mostly just used it to kill time. Netflix does fit with my priorities, because it’s important to me to be able to sit down with my Dude at the end of the day and unwind with a few, intentionally chosen shows or movies that we both like. Some small level of entertainment fits with my values. A 600-channel HD package does not.

Money I saved: $60/month (replacing cable with Netflix), $35/month (cancelled gym membership), $15/month cancelled WoW subscription (don’t judge) = $110 total per month

2. If you have to pay something, figure out how to pay less for it.

You need food. That’s a necessity. You need electricity and water. Those are necessities. You need clothing and gas in your car to get you to work. Those are necessities. We can’t eliminate those things.

But can we find a way to make them cheaper? Start looking at your accounts and brainstorming ways to reduce the cost of things. For example:

  • Car insurance is a necessity, but could you get it cheaper somewhere else?
  • A cell phone might be a necessity, but could you get a cheaper plan? Check your usage data for the last six months, see what you’re actually using. Do you really need unlimited everything?
  • Electricity is a necessity, but could you get on a budgeted plan so you pay a consistent amount every month instead of having to deal with spikes in your bills certain times of the year?
  • Internet access is a necessity in 2015 if we’re being honest. It’s nearly impossible to function in society without it and anyone who says “Go to the library!” isn’t being real. But could you save money by downgrading to a slower connection speed?
  • Is there a cheaper grocery store you could shop at? I could write pages and pages of beautiful poetry about my love for Aldi, but instead I’ll just direct you to this page explaining why they’re so much cheaper and more awesome than other grocery stores. If you don’t have one where you live, chances are you have a discount grocery store that’s similar. Find it.

Money I Saved: $38/month (cheaper car insurance), $23/month (cheaper cell plan), ~$30/week (Aldi) = $91+ total per month

3. Decide to cook and write a meal plan (seriously, it’s not that weird).

This might sound like the “fluff” step, but it actually saves me more money than either of the the previous two. In the United States (and probably most other Westernized countries, but I won’t speak for them), we throw away an obscene amount of money on food.

Initially, it sounds trivial, but I promise you I am not full of shit. Eating out and ordering takeout is expensive. Buying those meals that come in a bag or a box and you just add some water or milk and cook it and it’s ready to eat? Do the math on one of those sometime. If you bought the ingredients and made that meal yourself, you’d be able to make 5 of them for the price of that one bag. Also? Most of them taste like hot garbage and they have a lot of really unhealthy crap in them. Your health is valuable.

I said “Decide to cook” and not “Learn to cook” because everyone knows how to cook. Yes, you. You know how to cook. Cooking is just following instructions and you learned that in grade school. If something calls for an ingredient or a technique you don’t know (like wtf is sauteing anyway?) just google it, or watch a video on YouTube.

A real dollars and cents example: Monday is pizza night at our house. A Digiorno frozen cheese pizza (which are pretty good if we’re being honest) costs $6.99 at my local grocery store. My homemade pizza recipe costs less than $2 when you add up all the ingredients and it tastes better. That’s $27.96 per month in store bought frozen pizza versus $8 for my fresh, homemade pizza – $19.96 saved on just four meals per month.

Here’s what you’re going to do:

  • Find seven recipes online that you want to try and save them – I keep all my recipes in Google Drive using this method and it works great. Pick things that:
    • Don’t use a huge number of ingredients.
    • Don’t use super expensive or complicated ingredients (like, maybe don’t start with spaghetti squash)
    • Have some common ingredients (buying a bigger package of something is cheaper per unit than a smaller package)
    • Will leave some leftovers for lunches the next day

My secret weapon is the Budget Bytes website and I totally recommend that you start there. Beth breaks down each of her recipes into prices per ingredient, per recipe and per serving. It’s awesome.

  • Then, write your meal plan:
    • Open up a spreadsheet or grab a piece of paper
    • Write the days of the week across the top
    • Under each day, write what meals you’re making
    • Under each meal, list the ingredients
    • Cross out the ingredients you already have in your kitchen

What’s left is your grocery list. Good job!

I used to buy groceries with no plan whatsoever. I just bought whatever I knew had run out and a bunch of other crap I thought I might use during the week. I was throwing away a lot of very expensive food that had gone bad because I hadn’t used it quickly enough, or ending up with random ingredients that didn’t make a meal. It was a huge waste of money.

Meal planning has this reputation as something that only stay-at-home moms do, but I’m definitely not one of those and I will proudly show you my meal planning spreadsheet any day of the week. I spend less than half what I used to, rarely waste anything, and it takes all the stupid mystery out of what to have for dinner (I don’t know, what do you want?).

Money I Saved: $25-$50 per week (at least) = $100 – $200 total per month

Real Talk: Money is an emotional issue for a lot of people, and sometimes there are a lot of gross feelings (shame and embarrassment, to name just two) that go along with scratching to make ends meet or being in debt. But no one ever builds financial freedom by hiding from the problem. And taking a real look at your money is the first, most important step in getting your financial shit together. I guarantee you will feel relief once you start to take control of the situation.

The first step to financial freedom is really LOOKING at your money. Click to Tweet.

It took me a few years of paying down debt and spending carefully, but I’m in a much better financial position now. Even though I don’t really have to count every penny in my budget anymore, I’m still doing the things I’ve outlined here because I like the feeling of a bigger bank account balance and more money in my savings. If shit ever hits the fan, I know that I’m prepared.

Before you go, get a jump on straightening out your money right now. I made this free spreadsheet just for you to make the numbers really make sense.