Can You Really Budget Without Feeling Trapped? Danielle’s Story Says Yes | 432

0:00Hey, before we jump into the show, we wanted to give you a heads up that our free budget workshop is happening Friday, September 11th at noon central. At the workshop, we'll show you the simple budget system that we use to help women organize their money, stop living paycheck to paycheck, and finally feel confident when it comes to their money. So if you're brand new to budgeting, this will help you start the right way and avoid common mistakes. And if you already have a budget that's not working, this workshop will help you simplify it and make it work for real life. This workshop is a hundred percent free and you can save your seat right now at budgetbesties.com forward slash workshop.

0:31We're not asking you to track expenses. That is a strict time consuming, frustrating budget that I don't want to do. Shane is not going to do. We don't want any of our listeners to do. We just want you to assign your money to specific categories. So you have the freedom to know what you can spend on and what you not, what you're not going to spend on. and that's why ours are it's very generic it's very like bird's eye view of this is gas and groceries this is spending money this is for the kids this is for family fun which is ice cream goofy golf whatever and that's it we're asking you to break it up into those five little categories so you can clearly see where the heck your money is going every month okay but pay what you're doing right now is this paycheck budgeting of your money does this and my money does that We need it all together.

1:15And then from there, you can divvy out what needs to go out based on what your budget says.

1:43like you have your finances all together, or you're not on the same page with your spouse when it comes to finances. We know what you're doing probably isn't working, but guess what? You're in the right place. We're Shaina and Vanessa. We're best friends, business partners, and master financial coaches trained by Dave Ramsey. We've been in business since 2019, helping hundreds of amazing people like you create budgets, get out of debt, stop living paycheck to paycheck, and know exactly what to do with their money. In this podcast, we'll share with you everything we know, plus everything we're working on with our clients so that you have the best chance at reaching your financial goals.

2:17We want to help you take the guesswork out of your budget, improve your marriages, and even bring your kids in on the conversation. We can help you no matter where you're at, whether you're the single mom who's never had$500 in her savings account or the millionaire who's paid off four real estate mortgages. And we're not gonna shy away from the tough love. We'll tell you what you need to hear and encourage you at the same time. This is the Financial Coaching for Women podcast. Okay. All right, Danielle, we're excited to have you on Financial Coaching for Women, and we're excited to see how we can help you.

2:49So tell us what brings you the call, what's going on, how can we help? My husband and I have been struggling for a little while with finances. I feel like it all starts off when you're like fresh in high school, like out of high school, going into college and they trap you with you need credit score, you need credit cards. And so it started there and we just couldn't get out of that debt. So we recently had last fall, we actually filed for bankruptcy. it was like the only we tried so many avenues to get out of the debt that we were in and it just nothing was working so we recently I think it was last month got discharged from that so we have no more credit card debt but we're still in a spot where yes we're able to save a little bit of money and maybe put that towards other debts like our cars student loans and things but still trying to learn on how to get out of this sticky area.

3:58Okay. Have you made a budget yet to see exactly how much is coming in versus what's going out? I have written down what our monthly income is versus the bills that we have coming in. I have even, we had just one checking account and one savings. I've split it into different areas now. So now I have a separate bank account that's just my income that goes into it and that's our spending money. And then there's the other account that's just for the bills. And then I also have a high interest savings. So just trying to figure out like what to do and that's all fairly new. So yeah. Okay. Okay. Yeah.

4:43So that's a good start and you have the right accounts, but we need to know it's arbitrary that we say my income is it arbitrary. It sounds arbitrary. Like you just decided my income will be spending and your income will be bills. But do you have number figures assigned to that, that you know, that those numbers, that's the right choice. Do you have you? Yeah. Okay. Yeah. Tell me how to do that. It worked out where my payment, my paycheck was basically just split it just split up that way it just happened to be that way otherwise i would have had a portion or a certain percent of my income going into that other account and i still can divide it that way if it comes down to it but yeah i just have when you so you have all your bills listed out and it was equal to his paycheck or his income all month yes okay and so then your paycheck is supposed to do everything else besides pay the bills or your paychecks.

5:40Yeah. Okay. And have you looked at all the bills to see if there's anything you can, you could or would reduce? Yes. I've also done that. So I've reached out to cell phone companies, the internet companies, see how I can get those bills down. I've even taken our youngest son out of daycare two days a week to have my mother-in-law watch him to try and save some money there. Yeah. I feel like I've contacted the companies that I needed to try and reduce any bills that we have. What about auto insurance and how do you con? Yeah. I switched auto. That's a big one. Yeah. Last fall, I think we had switched auto insurances.

6:24Okay. So when we look at your paydays, are you using what like what amount of that is for groceries what amount is that like so it really does need to be all on one paper if you decide yeah if you want to change where the paychecks drop that's one thing but all on one piece of paper with all of your income and everything what your how much are you spending how much you have you don't have to tell me ask the groceries you have a certain number for spending for each of you maybe something for the kids restaurants entertainment like what how do you have your paid paydays broken out

6:57so it's I've found it difficult to have it budgeted like a strict budget because my husband will just be like oh yeah I saw this and I thought it was on sale and so I got it and I'm just like okay so like I'm the finance person that's paying attention to everything and because he I've tried getting him to get into these apps and he's just not like text. He just can't do it. No, it's fine. Yeah, that's okay. But yeah, I'm having trouble sticking to a strict budget. But basically, I'm like, it goes to groceries. What we spend on gas, we spend on gas. And then anything at the end is our spending money.

7:42Okay. Are you guys using one account to do all this out of? Like pay bills, buy groceries? We just, so yeah. recently, I think last month separated that. So our bill money is separate from, from everything else. Okay. Yeah. But the groceries and gas I included in like the spending side of it. It's not perfect. Yeah. Yeah. That's yeah. That's not bill. If you get invoiced, then it's a bill. You have a due date on something. It's a bill, everything else that you swipe for, pay for tap for whatever that is considered spending. So I'm glad that you have that all in these separate accounts. It sounds like we need just a little bit more accountability and we need to get a couple more checking accounts.

8:23And the reason for that is if you have a bulk of money sitting and spending and that's not working, then we need to separate that out. So we know exactly what is for gas and groceries, exactly what is for the kids, exactly what money he can go and spend on whatever he wants without judgment or, and then you don't have to freak out about it, but it sounds like we need to divvy that up. So it's more organized. I know the first thought with men is like, why do we need another checking account? this is stupid. I'm telling you, this is what we hear. I will tell you after a couple months of doing it, the guys love it because it's separate and it's their money and they can do what they want with it.

8:57And it doesn't interfere with all of your financial brain and anything that you have going on. All right, budget besties, it's time for some real talk. You don't need another budget. You need a budget system. Our simplified budget system is what you've been looking for. It's going to allow you to be bougie on a budget. You'll be able to easily set up a system that runs automatically and shows you exactly where your money is going. And it's going to give you permission to spend. Everybody loves that. Yeah. It's straightforward, pretty, and packed with walkthrough videos that break down the exact methods we use with our clients to get out of debt, set up a bills account, separate spending, build savings buckets, and end the paycheck to paycheck feel.

9:38If you're new to budgeting, this is the perfect way to jump in. And if you're already a budget nerd like us, you're about to meet your new obsession. This is the upgrade to your finances that you need right now. Yeah. So head on over to budgetbestc.com forward slash budget and grab yours. Now back to today's show. So the reason I don't particularly like that the one paycheck is assigned to spending, we need to see a whole overall. So right now we need to know when we put all of your incomes in one account, how much is left over? Because what you're doing is everything that's left over because his pay checks have paid for the bills and yours are quote unquote extra but they're all getting gobbled up by spending even though you need to be saving or paying off debt so those are different categories going into spending so i agree with vanessa you need to at least set and so you said i don't want to have a strict budget no what it doesn't have to be strict it has to be a budget so those are two different things you can have $500 spending money every month if you guys want.

10:40That's not strict. That's fun. But we just need to assign it so that you know everything else is covered. So that's why we would say separate accounts. So we're going to have one for gas and groceries. And you put the amount that you guys need to eat every month in there and nobody spends it. Nobody touches it except for gas and groceries. You're going to have an account for spending for him and for you, separate, not joint accounts, like he said, he can surprise you for your birthday or whatever. And you at least need those. And then once those are minimally taken care of, if there's money left over, then we're going to decide, do we want it to go for something fun like restaurants?

11:13Do we want it to go for different kids stuff? Do we have an emergency fund we need to set aside? Do we have, but it's not just all this one big bulk of spending because you're never going to get ahead of that. We're spending everything we make. And your paycheck budgeting right now is what you're doing. Like you don't have a budget. And I saw that the wall go up a little bit when we talked about, do you have a budget? Because you said, I don't want a strict budget. Girl, we're not asking you to track expenses. That is a strict, time-consuming, frustrating budget that I don't want to do, Shane is not going to do, and we don't want any of our listeners to do.

11:44We just want you to assign your money to specific categories so you have the freedom to know what you can spend on and what you're not going to spend on. And that's why ours are, it's very generic. It's very like bird's eye view of this is gas and groceries. This is spending money. This is for the kids. This is for family fun, which is ice cream, goofy golf, whatever. And that's it. We're asking you to break it up into those five little categories. So you can clearly see where the heck your money is going every month. Okay. But what you're doing right now is this paycheck budgeting of your money does this and my money does that.

12:16We need it all together. And then from there, you can divvy out what needs to go out based on what your budget says. Yeah. And since you're handling a lot of this on your own, what we want you to do is be able to make it automatic. So once you decide these numbers, Let's say you decide$1 ,000 we need for groceries a month, right? How often do you get paid? Do you get paid twice a month? You get paid biweekly. Okay. So each time you get paid, give or take, and some months are going to be wonky, but generally you get$500 going over to your grocery account. It's still all pools in the bills account.

12:51Every two weeks we have$500 for groceries. And you would do the same for each spending category. But this is how, that's why it's not strict. It's one, you don't have to spend a lot of time doing it. But now I just, I don't have to stick like to a certain, I don't have to stick and look at each number of what everything little thing is doing. I just know I have 500 bucks to spend on food for two weeks. That's not strict. I feel like it's, it makes it. And when you can automate it, which you can, your bank will automatically put that in there when you set up automatic transfers, really like hands off.

13:20And what that does, the more you're in it, Danielle, the more you're like anxious about it, the more you might mess up the math, the more, but if you just set it up and every two weeks, the spending is getting funded. And then you also, when you use our system, you'll know, okay, if we allocate, if we put all of our income in one pot, we pay all our bills, we have this money set aside for spending, we have about$200 quote unquote extra each month, give or take, depending on the month, what happens, right? Then I can purposely do something with that 200, whether it's paying, paying down debt, or setting some aside for something for the kids or a Christmas fund or whatever.

13:52But if I don't have all of the numbers on one piece of paper, that is not something I can do. And if I'm just spending everything that's in that paycheck, because I know I can, but at least I know the bills are covered, but then I'm also not going to get ahead. Yeah. And I had written out everything on a piece of paper. I had our income, I had all the bills. So that's how I figured out how to separate and make that other account and kind of what needed to go into there versus the other one. And thankfully, now that we don't have that credit card debt anymore, we do have a little bit that's going into a high interest savings.

14:25That's good. But I do agree that there needs to be more organization and maybe another type of checking account. They'll just save you. Sorry. It will. What you don't want is not be able to get groceries because he saw something on sale, which I'm not saying maybe it was like cause you stress charcoal was on sale. I'm not saying he was like, whatever, but like, you need to know that everything is separate. And if he knows I have this certain money in my personal spending account, I can do whatever. And it's not going to hurt the bills. We're going to have food. We're going to have gas. That's just better for everybody.

14:53Yeah. Yeah. I agree. And I think you're right. Like he wants to be able to spend money and especially his money and he works extra time. He wants that money that he earned for working overtime. So yeah, I think having like a separate account where he has that extra money to spend when he wants to will be less stressful for me too. Okay. I'm going to, I'm going to push back on that really quick. When you said that he works really hard and he works extra times. So he should have that extra money. This is y 'all are in a family. You're doing this together. So that money needs to be pooled in a budget and you need to have a set amount that he spends on himself.

15:33You spend on yourself and the rest of it is reaching your goals. You don't want to get back into this place of having to claim bankruptcy again because he spent every extra dollar and you calculated, oh, you worked overtime. So you get to keep that extra because that's yours. No, he's working overtime for your family. If that's what has to happen, I'm not saying he needs to, or he has to, or he should, if that's what you guys decided, and that's your goal, like he needs to work overtime to get some things done or to pay off the car or whatever it is, then that is a decision. That's a goal that you guys have made that money needs to honor your family.

16:05I think you just have to have, now that you guys are out of this credit card debt, you have to have a conversation about your vision. what do we want because what we will all do we will all spend the money every time if we don't have something else if we don't have a bigger goal then we will just spend the money if he is if he doesn't have a goal of going on a fishing trip or whatever i don't even know what it could be then he's gonna spend it that's just natural so as a family you guys will have goals together like what where you're trying to get to and you might have some individual goals go having those in the back of your mind helps you to be like, yes, I worked overtime, but I know that I worked overtime and$200 went to our vacation account because I did that, right?

16:47Instead of I worked overtime, I had more money to spend because that's how we stay poor. That's how we get back in credit card debt because we're just like, I'm working so hard to spend it all. No, let's work hard so we can get ahead in some different ways, like your savings account that you're doing. But the next, once you get this under control and get, just get your spending separated, have goals that you both agree on and that you're working toward, then you're going to start being even more sophisticated with savings, right? Because you're going to have a picture of the future. The one kid that we talked about in daycare, they probably going to have some expenses that maybe you guys want to provide for them.

17:18Maybe you want to go on vacation, maybe whatever these bigger goals are, you're going to have individual savings buckets for those too. And I have a hard time believing that every single dollar that comes in from his paycheck is the exact amount of money that's being paid on bills. And for you, the same thing, every dollar that you have is exactly what is needed for spending. So we need to bring those numbers together and figure out what do we have going out for debt, for bills, for spending and savings. And I know you guys right now have money going into a high yield savings account. That's fantastic.

17:48But you need to put it on paper to see if that's actually what you should be doing. Maybe you can contribute more, but you don't know because you don't have it written down yet. And we so it is a great first step. Like you did, you have the accounts are doing really good. The next step, though, Danielle, is what am I saving for? because this is ethereal, like I'm saving money, which is a good first step. Like most Americans aren't doing that. So good job. Yeah. But it's specifically for what for, because then I have goals and like it will inform how I behave with my money. If I know I have specific goals rather than I'm saving money.

18:20Then you know what? You can write. Oh yeah. Account says Melanie's wedding. I'm not going to rob from that to go to Target or to Bass Pro Shops or whatever. As much as I would if it's just, I don't know, savings, we're saving for things. So I'm saving for this Target trip, especially obviously. So the next, so when you guys, when you, do you have our budget system yet? No, don't have it yet. If you get it, we encourage you to get it just because there's an awesome section in there about savings buckets and what it's going to allow you to do is to save on purpose. So you're going to plan out what you, what your family costs in a year.

18:53Okay. I don't know if your kids are in sports or they have things going on or what your medical co-pays are. If you have pets, do they, what are their annual visits? There's a, how many times do you get oil changes. There's a lot of questions and making a budget for gas groceries and going out to eat every month is easy. It's the everything else that pops up Christmas, birthdays, travel, gymnastics, leotards, whatever. It's all that stuff that pops up that we forget to budget for. But if you make savings buckets and you say, okay, I need$2 ,000 for Christmas. I'm going to divide that by 12 and I'm going to put money every month in there to be able to make this work.

19:27You're going to be saving on purpose and you're going to know your why when you have that high yield savings account for that bucket. Does that make sense? Yes. That makes sense. Yes. All right, girl. Thanks for coming on. Thank you. Okay. All right. Good luck to you. And we appreciate it. Thanks. I appreciate you guys. Bye. Bye. If you're tired of feeling like your finances are all over the place and you're ready for a simple set it and forget it way to budget, we have something special for you. Watch our automate your budget masterclass at budgetbesties.com forward slash automate. We'll show you step by step how to finally organize your money, how to set up your accounts and put your budget on autopilot.

20:06So your bills, saving and spending run like clockwork. Imagine less stress, more savings and the freedom to spend money without having to track every dollar or babysit your bank account. Go to budgetbesties.com forward slash automate to start today.