I have always had a small problem with money—in that I always had something to spend it on. In college it was paying tuition, as soon as I got a paycheck, I turned around and paid off part of my semester bill. This worked well until I graduated from graduate school, got a job and had to move. There I quickly spiraled into debt, even though I had a budget set up. Moving home after the job was loss, helped me get the debt down, but not totally eliminated.
I know where my problems lie in money—it is the personal spending—the books, movies, games, music, things to keep me amused and occupied when I’m not at work. The reason why I spend money on these “trinkets” is that it takes time for me to make friends, and when you are at work all the time most of the friends you make are associated with work. I have nothing against that, except for the fact that you may not have anything in common with the people other than work—and everyone will admit that you don’t want to be talking about work every day of the week. When I was out in Boston, there were acquaintances that I would see when I walked my dog on the weekend or the evenings—but only then. I’m a very shy person (until you get to know me), and that makes it a little difficult to make new friends (which is something I know that I need to work on, and will once I move yet again).
So back to the book, there are good tips on the fact that you need to know where all your money is coming from, where it is going, and then putting it into different categories. Once you have the categories, you can put “caps” on certain ones so that you can slowly start saving money. One area that is suggested for “caps” is the personal spending (eating out, buying the morning coffee, snacks, so forth).
Goals should also be set, which includes short term (up to a year), mid-term (one to three years), and then long term (anything that takes longer than three years, but hopefully less than say ten). As Zoe points out “budgeting develops several virtues, like frugality, resilience, willpower, self-control and ultimately self-esteem and confidence.”
I also like how there is a whole chapter on budgeting tips (some of which we’ve all heard throughout our lives), and that she also points out that “budgeting is not a habit but a lifestyle.” This is something that I have slowly been working on since I’ve been unemployed—luckily I have the emergency funds, and can tap those to get the credit card debt down to basically nothing. Once I manage to find a job and have moved I will be doing a more hardcore budget for a few months to ensure that I won’t run into the problems that I did when I lived in Boston.