I do not make a lot of money. As a delivery driver for Amazon, it is fair to say I am not rolling in the dough. Despite this, I can afford to pay my rent and all my other bills and still have roughly $500-$1000 extra every month.
How do I do this? Do I know some kind of hidden secret that was just recently discovered in an ancient Chinese burial ground that was lost for thousands of years? Was the secret guarded by a gargantuan phoenix with a deafening screech?
Although those explanations would be a lot more fun to write about, the answer is no. The short answer is having a budget.
Why do people not have a budget?
A budget means different things to different people. I would say most people I talk to seem to view it as some kind of foul-smelling boss at work — they do everything in their power to avoid it.
Instead, people should aim to look at a budget as what is giving them permission to spend. It is hard to follow a plan or budget when you believe it is putting too many restraints on you. People like to be able to make their own decisions. “Rules drool,” am I right?
Wrong. Rules and being held accountable are exactly what most people need when it comes to their finances. Unfortunately, most people just do not know how to handle their money.
The fact is that most people do not have enough savings, do no kind of investing, and are just willy-nilly with their finances. If this year has taught us anything, it is that we can not afford to be careless with our money anymore. We need a plan and rules to follow when it comes to spending.
But I make minimal wage! I can’t save a penny!
It is time to get brutally honest here for a minute. This might sting a little bit. But I can promise you I’m not shaming or degrading you in any way. If you are making minimal wage or really anything less than $15 an hour you need to look for something else.
As stated earlier, I deliver packages for Amazon, which is hiring like crazy right now. I’m not sure in other states, but drivers here start anywhere from $18-$20 an hour. This can also come with bonuses for packages delivered as well as PTO and insurance.
Working in the warehouse pays a little less, but someone I know started working there for $16 an hour. I have a cousin who is still in high school while working at Starbucks who makes $15 an hour. The point is, there are jobs that offer you decent pay that you should be able to make work.
How to start a budget
In the beginning, budgeting can be very difficult. It took me a few months to get pretty good at. But once you get moving, it is much easier to maintain, as most of your expenses should be about the same each month.
I personally use the “Everydollar” app, which tracts every dollar you make and spend. The point here is to make those two equal to $0. That way you know exactly what, where, why, and how you are spending your money.
For example, let's say you bring home $2500 every month. You spend $800 on rent and $400 on food every month. That leaves you with $1300 of your hard-earned cash to direct. You continue to subtract everything else you spend. This may include a car payment, insurance, gym membership, etc. Hopefully, you have $50 or $100 that can be saved every month.
This may not seem like a ton at first, but it is a step in the right direction. If you can save $100 a month, that equates to $1,200 a year. That could be enough to fund an unexpected expense such as a car repair. Again, small incremental steps are what we are looking for here.
What budgeting will teach you
Now here is the good stuff. You decided to make a budget so that you can get control over your wealth. What can you expect to happen?
- You will know where your money is going
- You will be horrified at some of the things you were buying
- You will notice you were spending more on going out to eat than you thought (probably significantly more)
- You will be in control and have a greater sense of freedom
Before I started budgeting, I would often wonder where all my money went at the end of the month. Because I didn't track it closely, the money I made controlled me and my impulse spending led me to have no money.
These are just some of the things you can expect to learn from budgeting. I know it has really worked for me and has helped me save quite a bit of money over the years.
I want to emphasize this will be difficult in the beginning, but it is something that anyone can do. In fact, not budgeting will lead to a much more difficult life for you in the future.
I hope this helps.
