I remember clearly when I undertook the challenge to discover what I was really spending my money on. I looked at my last three months of bank statements. And Lord have mercy, but I was spending a lot of money going out to eat. Like, not just a lot of money. But a lot a lot of money. It was immediately clear where the cuts needed to happen and where my habits needed to change. Going out to eat so much wasn’t just expensive. It was unhealthy, time-consuming, and I was so used to eating in restaurants that I didn’t enjoy the experience any more.

Does any of this sound familiar?

Most of us jump too quickly to how things “should” be, when often a simple, honest evaluation of where things are will tell us everything we need to know. Instead  of judging yourself, I want you now to take the concrete step of simply finding out what you have spent your money on each month for the last 2 or 3 months.

No one likes making a budget that tells them what they should spend.
Yes, I know, no one likes making a budget.

First, write out an estimate of what you think you are spending your money on each month. Include every category you can think of. Take that all in. You might already know what changes need to be made!

Next, find out the real numbers. Download your bank statements or rummage through your past receipts and figure out what is really going on with your spending. How much do you spend on rent, on the mortgage, on utility bills, on internet and phone service, on technology, on clothes, on food prepared at home, on eating out, on entertainment, on gifts and donations, on alcohol and drugs.

Now look at those numbers. See how they compared to your estimates. Are there any surprises? Does anything jump out at you? Does anything look seriously off? Are there places where you spend far more than what you estimated? Are there areas where you don’t just spend a lot, but you spend a lot a lot? Focus there. Are there expenditures that just look completely out of line, even if you estimated them correctly? Focus there too.

Not everyone needs a budget that tells them what they should do. But all of us, at least once, need to take a good look at what our monthly budget actually is.

And now it’s time to ask yourself these questions:

Are you investing in yourself, your future, and your community? Are you spending on the people you really care about? Are you spending on your biggest dreams and passions? Does your spending fit with your goals? Does your spending fit who you want to be, what you want to do, where you want to go, how you want to look, and how you want to feel?

We need to talk about how to get to a better budget, of course, but for many of you that step won’t even be necessary. Just looking at where you are now will tell you everything you need to know.

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