Make Good Money but Keep Overspending? How to Budget Without Feeling Restricted | Reair: The Crazy Ex-Wife’s Club with Erica Bennett | 607

0:00This is the one area in their life they feel like they're failing at and they feel really shameful around they don't know how. A lot of people think that they have an overspending problem, but it's really an organization problem. You get to set it up one time and then it's running automatically. I used to always think about my money like little tiny rabbits fornicating in my bank account while I slept at night. If I can dig my way out of$50 ,000 of debt and pay it off and live debt free and have my money work for me, you can too. Do you make good money but have nothing to show for it? Are you tired of living paycheck to paycheck?

0:34Do you have big dreams for your financial future? Do you want to get debt-free but you don't want to live on beans and rice? Or you don't want to give up those pumpkin spice lattes? If you don't already know how to budget or if you're using credit cards to get through the month. If you want to seem like 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 Shana and Vanessa. We're best friends, business partners, and master financial coaches trained by Dave Ramsey.

1:04We'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. We 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.

1:36And we're not going to 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. I think most people are not really taught how to budget. We're taught the basics. Hope, fingers crossed, hope that more money comes in, then money goes out. We all probably, if you went to college, that's when I got my first credit card because they were camped out outside the student union, pushing high percent APR credit cards. But you're 18 now. Your parents aren't here to say no. What's going to happen? So I definitely ran that life lesson of filling three.

2:17I think it was three, two or three maxed out credit cards. By the time I finished college, it was like pay the minimum from one to the next to just try and find a window of opportunity to make it to the next month. But you guys successfully paid off 20 some thousand dollars in credit card debt, not making a crazy salary, like right as a new little 20 something year old. So it is possible. You just got to have the right tools or the right system. And that's where you ladies come into play. And I think they suck you in with like zero percent for six months or whatever, right? They try to get you a lifetime when you're 18.

2:50Oh my gosh, I know. So they try to reel you in that way. And like you said, nobody's there to console you and to give you any more advice that this is what everybody else is doing. This is what you're supposed to do. And you have to get a credit score to be able to buy a house and buy a car and all this, these grown up things that they tell you. So it's really easy to get sucked into that. We have a lot of women that come to us that are divorced, that meet somebody in their corner to help them and show them because maybe they've never handled their finances before. Or maybe they just weren't the one dealing with it.

3:20And now they're all alone trying to do it by themselves and they have no idea what's going on. Yeah. And I think that the whole space that we can go into how we got started, but this whole space about money is very men heavy and they have their own perspective on it. But we want to be literally the opposite of all of that. We really try to make the conversation less judgmental because Vanessa said either they didn't handle it or a lot of the identity that they have comes with phrases like I'm bad with money or I have a spending problem or whatever. It's all this negativity that they put on themselves.

3:51And so we just want to flip that whole conversation, make it fun, make it simple, make it doable. Then of course, like you said, we're going to be bougie on a budget. Yeah. It's so important because I would say I never felt like I was bad at money. I really loved money. I always worked multiple jobs. I always had systems. My first job, like bartending, it was like, hey, when you get a hundred dollars in cash,$20 is fun money. $80 rolls over into savings. Like I have been so structured. But when the divorce hit, there still was a lot of fear, a lot of uncertainty. Like how am I now going to pay for the things that used to be so second nature?

4:24I never thought twice about swiping the card for Amazon or swiping the card at Target. And now we have to start rethinking some of those things. So I am curious, from all the women that you work with, what would you say are some of those first mental hurdles that they have to get over to be able to finally start moving forward with the behaviors, the do that's going to change their money situation. I think we see them a lot, like Shana was saying before, like shameful that they should have known that they're so good in other areas of their life. So maybe they're entrepreneurs or maybe they're a wonderful mom.

4:57Maybe they're big in their community. Maybe they have a standout job that they're really they have a high position in. This is the one area in their life they feel like they're failing at and they feel really shameful around that they don't know how. And then they should have known how. Like we hear that a lot. I should know. I should know. No. If anyone taught you how to do that, no, you shouldn't know. And so I think breaking that down first, and really what we love about budgets is that it's black and white. It's just, it's data over drama. So we just, we put the words and numbers on paper and show them what's possible.

5:26And I think them knowing that, again, we have somebody here, an outside person's point of view, a bird's eye view, somebody coming in, looking at it in a different way, a different light, who's not emotionally attached to their money or the situation at hand can really help guide them. Yeah. Yeah. And I think so often too, once something becomes a problem, I tend not to want to look at it. So like even not money related, money related, but like the one I'm thinking about right now is there was a reel that went viral. And so there's a ton of comments out there and I didn't answer them that weekend because I was traveling.

5:59And now every single day, that shame, that like weight is building of, oh my God, do you just keep ignoring it? Yes. So intensify that times a thousand because it's money and it's how you pay the bills and it's what's happening with your credit score. But same thing. We go, I just don't really want to look at it because then I can pretend like all the other feelings behind it don't matter. Yeah, absolutely. I think that we say people have their heads in the sand when it comes to that. And it's to your point. They just would rather not. But that's because it's very it's like a cluttered closet.

6:29Let me just shut the door. Or shove the drawer closed. Like just stuff it and shove it. But if you just go on this little journey with us just for a few minutes and get everything set up, it will look so beautiful. It'll be so amazing. And you'll just really love the results. But then the other thing that we say is with the system that we're going to talk about today, you get to set it up one time and then it's running automatically. So imagine you set up something to respond to all those comments every time you get a reel from here on out and you'll ever have to do it again. But you just set it up one time.

7:00That's what we're going to do. We're going to set up your system. It will pay your bills automatically. It will give you spending money automatically and it will save money for your trips, for your Christmas, whatever. All of it, it will do automatically if you just put the time in the first time. And that goes along with looking at it, looking at it, which usually Vanessa will attest. It's not as bad as you think. Like it's just a matter of decluttering it, organizing it, and then you're good. I love that. Yeah, you guys, they have amazing simplified budgeting system. We are going to talk about it here in a little bit.

7:28We do have a special link for you down in the show notes. but that piece that ray of hope that even when you feel like it's crazy and it's out of control and you'll never get ahead of it it literally comes down to just making a change and allowing it to start to compound or to roll together I felt like I was never going to get out from behind student loan debt and credit card debt and then I had a car payment on top of it and all of a sudden, I remember how like freeing it felt when the car was paid off. And when the student loan was paid off, all of a sudden I'm like, oh, there's this money now.

8:06There's this money every single month that for years, I don't know how long it took me, 10 plus years to pay off my student loan. For all those years, it just was already taken. And when that happened, then things started to shift very quickly. Because again, then I could roll that into the next payment. That one paid off faster, rolled into the next one. All of a sudden, all the debt was gone. And now I could roll into savings. And then you were ahead of the game. So let's talk a little bit about budgeting systems. Because the whole goal is we wanted to make sure for you guys listening, we wanted to talk through how do you make a budget that doesn't feel constrictive, something that supports you in your new way of life.

8:44So just a little bougie. You do get to buy all the crystals that you want to buy when you want to buy them, but that it's not setting you back for having to eat ramen noodles. for a month to be able to get through it. Yeah, no, absolutely. And our system, there's three steps to it. We'll go through each one. But the idea is we want you to create a simple budget and then we want you to separate your money. Then we want you, like Shannon was talking about before, the last step is to automate it. And so when we originally, we had no intentions of creating our own budget. That was not in the plan for us.

9:13And we tried to find one out there that didn't require you to track everything and just really be in it all the time. And just, there was just a lot of clutter. for you to be able to maintain the budgets that we saw out there. And so we did, we curated our own and it's beautiful. It's eerie. It has beautiful checkboxes if you want to go in there and do that, but it allows you to see everything on one piece of paper. Because think about when we first started doing this, we were looking at all the words on different budget tablets and it was like fixed and variable income or expenses and then needs and wants and all that.

9:46No, we are, the way that our budget is set up, it has five simple columns and it's how you handle your money throughout the month. It has income. It has debt, bills, spending and savings. That's what you're doing. You have income coming in and you're doing one of those four things with it. And so that's how we have ours categorized. Yeah. And like Vanessa said, it matches what you do with your hands. We don't need all of these complicated categories and just different words. And they're ugly. And like Vanessa said, it's very cluttery. It's very simple. Income minus your debt minus your bills minus spending minus savings theoretically equals zero on purpose.

10:19Right. And so that's our budget. It's very, it's very simple. I'm a part of our system. Have you ever, Erica, did you ever hear about the cash envelope system? Oh, yes. In fact, my child, I didn't, I'm trying to think, I don't think I ever ran it, but it was so cute. And I'm trying to teach my kid about budgeting and money. And hey, you save some for your big expenses. You want to buy a new gaming monitor. You want to buy a PS5, but you need to have some fun money too. So we started there and he came back actually from Amazon and he's, I need to have this book. I need to have this budgeting book.

10:51And it literally was like the book of envelopes. And I looked at them and I was like, we're not spending$10 on envelopes. But I like where your mind is at. And I like that you put some thought into it and you were trying to figure it out. Talk to us about. I knew that you say that because it's universally appealing. Like even your child can understand it. The cash envelope system is separating money into different envelopes that is for a different purpose so that you can clearly see it organized. You can clearly see how much you have per category, all of that. When we started, like we're not that old and it's been a minute since we've been doing this.

11:21Okay. We were doing that. And then we found out nobody wants to do that. Then COVID happened and literally nobody will take your money, your cash money. So we migrated our entire system to be a digital envelope system. And so all of those category or envelopes that you would have had for cash. Now you can have a separate checking or savings account for it. You can rename it all the things or your bank has all the tools. And that is the system that is part of the system, it makes it separate. So first we made it real simple, bills, savings, spending, that's it. And then we're separating different accounts, which we can get into.

11:52And then the last step is to automate it because it can all be very, it can, like we said, you can set it up once and it'll do it for you. Yeah. So imagine like knowing that you always have money to pay all your bills. You have money for gas and groceries. You have all this stuff. But the idea here is that cash envelope system, it is digital. We're just basically swapping the credit card for the debit card here. And so you're very organized and you know exactly how much money you have for what rather than. Yeah. And I think that's so important. And that is exactly the problem with the envelopes and the cash part, right?

12:21People weren't carrying it around. But previous, there wasn't an easy way to transition that into where we're at now, which is really a digital world of money. And so you just lumped everything into one. And unless you were tracking like in a little like column. I've got this saved up for a vacation and this is going towards the car payment and whatever else. It's just a big thing. And that's when it can get really easy to accidentally overspend in one area or to move money out and then get caught and be like, oh, like I got a little backwards. Yeah. And to your point, a lot of people think that they have an overspending problem, but it's really an organization problem because if your money is organized, you will, they naturally are better with spending.

13:03Like I know I have 200 bucks to spend for fun money, like you mentioned with your son this month, I'm not going to go over that because I know at least versus when it's all in one account and it's a mess and it's a black hole, then I don't, sometimes I know that I don't have money, but I don't really care because I don't want to go through the work to try to figure it out. So I'm just like, I'll figure this out later. Swipe, swipe. And so we don't want that for you. When you have a, when you have one account that everything is coming out of your Amazon spending, your Target spending, your Starbucks, your nail appointment, your medical bills, your kids' soccer fees or whatever, all of that.

13:35You have no idea what's happening in that one account. Everything is revolving. Your money is coming in. It's draining out. You're waiting for the next payday. So yeah, when you have an extra 50 bucks, you're probably going to end up spending it. And then you feel like you have an overspending problem that, no, we just really need to take the money that you want to spend on yourself out of the equation. And so it's out of that account that's strictly just paying bills. And just real quick, I want to put it into maybe some terms that we all understand, which is it's like the old way versus the new way.

14:02The old way we had, do we all remember using a curling iron when we were younger trying to get our hair to be all whatever? And Vanessa has her own stories about getting burned. I have my stories about anything I did wouldn't stay because I didn't know what I was doing. Our girls, our girls, we have two, we have three girls between us. They haven't, what's called an automatic, we call it, it's probably got a cooler name. It's an automatic curling iron, Erica. Now You put your hair, like a strand of hair, it tells you when, like it has a guard so it doesn't pull it. It helps the right timing. It beeps at you when you're ready to go.

14:32And it just, like literally you can curl all your hair in 10 minutes. And it's automatic. And it's way better than the version that we were using. And that's where we're at. We're in a modern digital age. Let's use all of the modern tools that we can for our budget so it can be easy and simple. I love that. 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.

15:05And it's going to give you permission to spend. Everybody loves that. 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. If 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. Now back to today's show. So I think we're at a place, listeners, that you shouldn't be afraid of it.

15:39This is not about being afraid. This is not about avoiding it. But what would you say? So you mentioned it. They drop in once and they set up, organize, get clear on what it is. Is that something that you guys think people should do annually about how much time does it take? If they're sitting there and they're like, OK, I am guilty. I have zero idea and I haven't done anything. We obviously are going to talk about the simplified budget system, which will be an amazing tool. And it is really cute, very pretty, very easy to follow you guys. I was looking at it. I was like, dang, you ladies did a good job.

16:11But that first piece. So they're like, great, I'm guilty. I need to do this. How much time do they need to set aside or what are they really looking at to to take some action and move that part forward. We like to say that there's 365 days in a year. We're asking for 12. If you sit down for one day a month, being able to look at your money and look at everything, like that is such a small amount of time. But to set everything up an afternoon, maybe I think, Shannon, if you really sit down and you have your numbers, go through your bank statements. And we're not saying go through your bank statements to track anything.

16:42We're saying if you've never known how much money you spend on groceries, or you don't know how much money you normally spend on gas a month or you go out, you know, whatever. We're just asking you to just go back and see what you normally did in a month. Don't pick December. OK, don't pick like holiday months, but pick like a regular month and just see how much you naturally spend in those categories. And then once you know that, you can break it down to say, OK, how often do I want to replenish those accounts? Is it weekly? Is it biweekly? However, you can take that and set up this automatic system to be able to fund those digital envelope systems.

17:15So that way you always have money. Yeah. And when she says an afternoon, that's really like Vanessa is saying one time, because it will, then you're going to need to look, check in with it maybe in the beginning, maybe like an hour a week just to look at, but probably not even that much time. And then it'll just be a matter of just thinking about what's coming up next month. And I need to just adjust my budget because our budget does it automatically. But even back backing up a little bit, I want to speak to your, to this woman that we're talking to our crazy ex-wives friends. You are not a CFO of your money.

17:45And you need, it's time for, it's time. Nobody's telling you what to do, but now you have to tell you what to do. Stepping into that role. Yeah, you are the CFO. And so you're going to be okay with, like looking at these numbers and being your own bank, being your own CFO, all of that. And so you're gonna need to devote some time to it. However, you said, Erica, it's not scary. We don't want it to be scary. You're gonna be bougie on a budget. Like whatever you want out of your life, your budget's gonna reflect it. You're going to put getting your nails done. You're going to put going on that trip.

18:14You're going to put all of that in your budget. It's not a scary thing. You do have to do the adulting. You have to make sure bills are paid. And maybe you want to save for kids college or something like that, whatever. But then let's put the fun stuff in there, too. But really, it doesn't take that long. And I always think, let's do a first draft. If I have 20 minutes, let me brain dump everything. That's why we put it all on one page, like Vanessa said. So it can't be that scary if it's on one page, right? Brain dump it. See where you get. And if you don't get everything done, fine. but it's really eye-opening just to get those initial numbers on there.

18:41And you can keep building it right from there. I mean, you're making your version of bougie. So that's why we love the phrase. And that's why we trademarked it because it's really fun. Her version of bougie is different than mine, the different than yours and different the next person. And that is okay. That's the point. And so you can make your budget. And we don't have cookie cutter budget. There's a lot of people that say you need to do the 20, 30, 50 % or whatever. No, your budget is going to be based around your income and your expenses specifically, not anybody else's. So you need to make sure that you want to do it because if you don't, if you put something on paper that you don't want to do, you ain't going to do it.

19:13Right. So we want you to make a budget that you love, that's exciting, that matches your goals and matches what, how you want to manage your money throughout the month. And let me, forgive me, Erica, let me just say when she says that no one is telling you what to do, right. We're excited about that, but also you can't fall back on that excuse anymore. It's time for you to step up. And a lot of times we see that rebellious spirit like, I don't get to, but you're the one creating it. So you get to decide what you're doing and let's not blame any ethereal person that's in charge anymore. You're doing it and it can be, your budget can match what you want, but let's leave that like rebellious person in the past and let's own it and let's make this budget fit who you want to be.

19:54Yeah. And I think that there's another side to that rebellious person too, who just goes, I'm going to, you know what, it's been so hard. So I'm going to treat myself to this. And I've already given up so much. So I'm going to do what I want to do. And while in the moment that feels very empowering, when you really stop, yeah, like when you really stop and look at it, it's not an empowering thing. It is a reactive, rebellious, self-sabotage piece. For me, my goal was, so when I look at budgeting, whether or not you ladies agree, but hopefully you agree. I never want to budget down to the dollar, the penny, even the hundred dollar.

20:31Like I always wanted a bigger cushion in there because my form of bougie was if I really wanted the organic blueberries, when I went to Whole Foods to pick up lunch, I got to buy them because that fruit looked really good and I wanted it that day. So I wanted to live in a space where there was a cushion, where everything wasn't so constrictive. But when I finally started looking at my credit card bills, instead of just living off my bougie blueberries, and I'd be like, why is it so tight? I started to realize that, yes, all those$30 Amazon purchases, all of a sudden there were 10 in a month, right?

21:08And I was like, what did I even buy? Or I wasn't looking at, lately I've been looking at how much is being spent in going out to eat and how much is being spent at groceries. There are seasons when we go out to eat a ton. And then now there's seasons where we got to shift. And so it's having that framework to look at it and I can choose differently. So we were going out to eat a lot and now we're shifting back into football seasons over. Sad day for my partner on Sunday. He woke up that morning and he literally was like, today's a very sad day. It should be a national holiday in America. After school.