I Can't Stop Overspending! How Can I Budget Myself?
on Tuesday, November 8, 2016
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Masha, 31, works for a start-up in San Francisco and can’t get herself to save money. She makes $110,000, but between her rent, her car, weekend trips, workout classes, clothes, dinners out, and goodness knows what else, she barely lives within her means. She even overspends occasionally, and has to rely on her credit card; she sometimes carries over the balance for a few months.
Overall, she’s a very dependable, responsible person, and feels so guilty that she can’t get this part of her life under control. She knows she should have an emergency fund, and she’d like to start investing a bit, too … but then there’s always another wedding to fly to, another dinner out that costs more than she planned, another rent hike. She worries that her lack of savings will affect her career choices, too; she’d like to start looking for a new job in the coming year, but she might have to choose a more stable, less interesting company over a more innovative, volatile one, purely because she doesn’t have any financial cushion.
Masha works hard and wants to enjoy the money she makes. How can she budget herself without feeling deprived?
Who among us has not experienced the stomach-dropping shame of “insufficient funds” at the ATM? It’s as if you jolted to a halt in the highway’s middle lane, out of gas. You are insufficient, the screen says. Instead of money, all you deserve is a flimsy receipt that says $7.06, printed on a slip of paper so stubby that you must claw it out of the machine like the subhuman that you are. Forget the dignity of your hard work and respectable job and tidy apartment and decent haircut — they’re not worth enough if you don’t have anything left over afterward.
As Charles Dickens put it, “Annual income twenty pounds, annual expenditure nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pound ought and six, result misery.”
The cornerstone of money issues: You must spend less than you have. It’s a boring, simple concept, but the execution — and the mind-set behind it — is a complex negotiation between your ego and your bank account.
I’m not one of those people who thinks that saving money can be fun or easy. Of course it’s not! I love buying things, and people like us have to gussy up the act of restraint to look less like self-denial and more like what it actually is: self-respect. A healthy understanding that you aren’t defined by what you buy, combined with the wherewithal to say no, requires a powerful and elusive level of confidence. And in today’s Goop-y world of cultivating your microbiome of self-worth through probiotic serums and shiny new lipsticks and Instagrammable vacations, it’s particularly hard to grasp — and more tempting than ever to throw yourself down the rabbit hole of “I deserve this, don’t I? Expedited shipping!”
Masha, if you don’t deal with your money, then it will deal with you — and cruelly so. It’s already jeopardizing your growth — you’re nervous about next career steps because you’re shackled to a set of expenses that limit your flexibility. But do you really enjoy half of the things that you’re so hell-bent on affording? You might not even like yourself that much — at least, not enough to save money for your future. It’s easier to try to add merit to your day by piling stuff onto it, rather than taking a hard look at its face value, but that’s where you must start.
“The tool I use for saving money is something I call joy-based spending,” said Manisha Thakor, the director of wealth strategies for women at the BAM Alliance and founder of MoneyZen. “Budgeting stinks. It feels like we’re in a straitjacket and we’re being deprived. And what we all want is to enjoy the day, but also know that we have security for tomorrow.” She recommends a two-pronged approach, starting with mentality: “Stop and think, first and foremost, ‘Where did this money come from?’ For most of us, it’s because we work. And when we spend our money, what we’re really spending is our life’s energy, those hours we’ve put into our jobs. So you want to squeeze the most amount of joy out of your spending as you possibly can.”
Fair enough. But my joy is wine and plane tickets. What about that?