Financial Feminist – Financial Foundations #2: How to Budget (Without Hating Your Life)

Intro

In this episode of the “Financial Feminist” podcast, host Tori Dunlap explores the topic of budgeting and how to create a budget that allows for guilt-free spending while also prioritizing savings. She emphasizes the importance of aligning your spending with your values and finding joy in your financial decisions.

Main Takeaways

Creating a Financial Priority List

• Emergency fund, pay off high-interest debt, prioritize investing while paying off lower interest debt, save for big expenses

The Purpose of Budgeting

• Budgeting is not about deprivation or punishment, it’s about enjoying guilt-free spending
• Budgeting is a permission slip to spend on things we love while also balancing savings

The Three Bucket Budget Breakdown

• Expenses, goals, fun
• Fun bucket should be made up of things that are valuable to you

Identifying Value Categories

• Determine top three value categories for discretionary spending
• Value categories are areas in life that bring the most joy
• Identify purchases that light a fire and bring passion
• Bucket three should be made up of these value purchases

Aligning Spending with Values

• Categorize your expenses into dining out, entertainment, home/nesting, art, events, travel, shopping, etc.
• Identify where you’re spending the most money and compare it to your value categories
• Align your spending with your values and make tweaks if necessary
• Start a new money diary and ask yourself if each purchase aligns with your value categories before making it
• Spend the majority of your discretionary money on things you love most, not what others love or what you think you should like
• Start a new money diary and reflect on your value categories before spending money

Upcoming Episodes and Sponsor

• The Financial Foundations series is about having quick wins with actionable steps to improve your financial life
• The next episode will cover debt, including student loans, credit card debt, mortgages, car loans, and medical debt
• State Farm is supporting the Financial Foundations series, which is hosted by Tori Dunlap

Summary

Creating a Financial Priority List

One of the first steps in budgeting is creating a financial priority list. This list should include building an emergency fund, paying off high-interest debt, prioritizing investing while paying off lower interest debt, and saving for big expenses. By establishing these priorities, you can allocate your money in a way that aligns with your long-term financial goals.

The Purpose of Budgeting

Contrary to popular belief, budgeting is not about deprivation or punishment. It is a tool that allows you to enjoy guilt-free spending while also balancing your savings. By creating a budget, you give yourself permission to spend on the things you love while still being mindful of your financial responsibilities.

The Three Bucket Budget Breakdown

To simplify budgeting, Tori Dunlap suggests breaking it down into three buckets: expenses, goals, and fun. The fun bucket should consist of things that bring you joy and align with your values. By categorizing your expenses in this way, you can easily see where your money is going and make adjustments if necessary.

Identifying Value Categories

Value categories are the areas in your life that bring you the most joy. By determining your top three value categories for discretionary spending, you can ensure that your money goes towards things that truly matter to you. It’s important to identify purchases that ignite your passion and make you feel alive, as these should be the focus of your fun bucket.

Aligning Spending with Values

By categorizing your expenses and comparing them to your value categories, you can align your spending with your values. If you find that you’re spending a significant amount of money on things that don’t align with your values, it may be time to make some tweaks to your budget. Starting a new money diary and reflecting on your value categories before making purchases can help you stay on track.

Upcoming Episodes and Sponsor

The Financial Foundations series, hosted by Tori Dunlap, aims to provide quick wins and actionable steps to improve your financial life. In the next episode, Tori will dive into the topic of debt, covering student loans, credit card debt, mortgages, car loans, and medical debt. The Financial Foundations series is supported by State Farm.

Conclusion

Budgeting doesn’t have to be a daunting or restrictive task. By creating a budget that aligns with your values and allows for guilt-free spending, you can take control of your finances while still enjoying the things you love. Remember to regularly assess your spending and make adjustments as needed to ensure your money is going towards the things that truly bring you joy.