Are there holes in my pocket? Where does all the $$ go?

Budgeting is something that I personally have struggled with and have as a priority this year. Are you like me? Do you struggle with keeping track of your spending?! If so let’s learn and work through the roadblocks together. I would love to hear from you if you find this post to be helpful and/or inspiring. I really want you to know that - so many others struggle too!

The next two paragraphs are taken from a Canadian Financial Capability Survey from 2021:

Budgeting is crucial for many Canadians in managing their day-to-day finances, keeping on track with bill payments, and paying down debt.

For many Canadians, creating and maintaining a budget is one of the most important first steps in managing their money. About half (49%) of Canadians report having a budget, up from 46% in 2014 (FCAC, 2015). The most common method of budgeting is using a digital tool, such as a spreadsheet, mobile app or other financial software (20%). This is followed by using a traditional approach, such as writing the budget out by hand or using jars or envelopes (14%). Evidence from the 2019 CFCS indicates that another 1 in 6 Canadians (17%) could benefit from having a budget. These individuals cite a wide range of reasons for not budgeting, such as not having enough time or finding it boring (9%) or feeling overwhelmed about managing money (6%). Others say they are not responsible for financial matters in their household or prefer not to know about their finances (4%), or that they do not know or prefer not to say (5%). These time-crunched and overwhelmed non-budgeters experience considerable challenges in managing their money.

Compared with non-budgeters who are time-crunched or feel overwhelmed, Canadians who budget are less likely to be falling behind on their financial commitments (8% vs. 16%). Budgeters demonstrate more effective management of their monthly cash flow: they are less likely to spend more than their monthly income (18% vs. 29%) or to need to borrow for day-to-day expenses because they are short of money (31% vs. 42%). Interestingly, Canadians who use digital tools for budgeting are among the most likely to keep on top of their bill payments and monthly cashflow. In addition, compared with Canadians who feel too time-crunched or overwhelmed to budget, those who budget are 10 percentage points more likely to be taking actions to pay their mortgages (35% vs. 24%) and other debts (57% vs. 47%) down more quickly.”

Where do you fit into all of those percentages? If you want to read the full report click here:

Let’s break it down and make it friendlier to discuss ok?! Let’s make a plan!

5 Steps for Creating a Budget

So you want (or maybe just need!) to get a handle on where your hard earned dollars are going? There is really no easy way to put this…you need to create a budget! This will help you to feel in control of your spending, where you can trim it and how you can save for what or whoever you want to save for! Whether it’s a person, place or thing that you need to save for, you will need to decide what your priorities are, and a budget will give you a roadmap. 

You will need a basic template to start with. There are many to choose from, and some good free online resources. Choose one that fits your needs. There are some great spreadsheets and budgeting apps available, like these two for example:

Take a little time to explore some apps, because they will definitely make budgeting easier! Yes you can do it with a pen and paper, but you will find that the app, once you get familiar with it, will save you time (and money!)

Step 1: Organize your paperwork.

Get everything together in one place! This can feel like the hardest step and may lead to feelings of overwhelm and upset. Take care with this step! Ask for support from a family member or good friend. Remember that this is a process, and once done you will feel so much more in control of things, and therefore less stressed. Here’s a starting list of what you need to gather: 

Bank statements

Investment statements

Current utility bills

Pay Stubs and other sources of income statements

Credit card statements

Rent or Mortgage statements

Any loans ie. student / auto / consolidated debt payments

All your receipts from the last three months.

What you need is all of the information about your expenses and your income. That way you can see the average and work with that number. The more information you gather, the better. So take your time with this process - one step at a time and remember to BREATHE!

2. Calculate your Income

This step should be relatively easy compared to the previous one right? If you have a regular paycheck where it’s a recurring amount each month then it’s simple. Include all sources of income, no matter the amount. If you are self-employed, add up what you have earned during the past 6 months and divide this number by 6 for the average, and use this average for your income. Yes any investment income is included as is any pension or child / spousal support. 

3. List all your Monthly Expenses

Make a list of all your monthly expenses. Just like step 1 - take it slow and remember to BREATHE. This step is extremely valuable and can trigger all sorts of feelings. It’s going to feel better once your done. You will need your bank statements, your CC statements and your receipts for this step. Here are some examples of what you will have a list of:

  • Rent or Mortgage

  • Car Payment

  • Car / Home / Tenant / Life Insurance

  • Groceries

  • Personal Care

  • Utilities

  • Childcare

  • Transportation

  • Travel

  • Loan Payments

  • Savings

  • Entertainment

  • ETC...

Now put the fixed expenses onto a separate list because you can’t change those in the short term. Perhaps you can make a longer term plan to change those, but for the immediate future let’s focus on the variable expenses (the ones that change month to month). Begin the process of putting some hard limits on the spending for these categories. If you have a goal in mind that is really important to you, then be ruthless with this part of the process.

5. Put The Big Picture Together

Here you are - ready to look at the big picture. It may be messy so get a cup of tea (or a glass of wine maybe!) and settle yourself somewhere you can be comfortable. Then get real. If your income is totalling more than your expenses, that’s a great place to start from. This extra money is yours to save, spend, put into a tax free savings account…that’s up to you to decide.

On the other hand, if your expenses are more than your income, you are going to feel motivated (hopefully) to change that scene now. When we write it down, it gets real. Look for areas where you can reduce spending, and again be ruthless. For example, cook for yourself rather than eating out, plan your outings, make grocery lists and stick to them, consider shopping consignment (did you here it’s trendy now?). Get creative and try to have some fun with this. 

Track it ALL

Now here’s where those handy Apps come in. Tracking tracking tracking…equals time. And most of us really don’t have a lot of extra time. So the Apps are going to be enormously helpful with this process, because ideally you are going to monitor your spending daily. 

Your goal is to keep your monthly expenses as low as possible. With a good App, this should take 5 minutes a day. Be patient and loving with yourself around all of this and celebrate the small stuff. If you have a good App please share it with others! I would love to hear about your tips and tricks for budgeting.

Thanks so much for your interest and for being a supportive force in my life!

From my home to yours,


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