Counting the Cost

The next step to saving money is creating and implementing a budget. Yes, a budget. The thought of budgeting may seem like a daunting task but if you do it step by step it is no more difficult than paying your bills. All that’s needed to begin budgeting is a recent pay stub and a copy of all your bills or a list of expenses. Once you figure out what’s your take home pay you just divvy the amounts.

For example (I’m going for simplicity) if your take home pay is $2000 a month a sample budget could look like:

Tithes: $200
Offerings: $50
Rent: $900
Utilities: $150
Car Insurance: $150
Gas/Metro: $100
Food: $150
Personal: $75
Student Loans: $75
Gifts: $50
Savings: $100

Obviously each person’s budget will depend on their circumstances. Personally, I like to give gifts for birthdays and budget in for my generous nature. I know a woman who prefers not to do her hair so she has a hair section in her budget that allows her to go every week for styling. Figure out what’s important to you while budgeting.

Also, a good rule of thumb is that you are supposed to save 10% of your salary for emergencies, long term and short term savings. The astute will notice the sample budget only has 5% being saved. Remember this is take home salary. Hopefully, you contribute to your company’s 401K or TSP retirement plans. Most employers match funds to 5%. So even if you can only have them take out 2.5% of your check the matching amount will bring you to 5%. As younger adults making lower salaries it is sometimes hard to have a large amount taken out of your check but saving something is better than nothing. Even if you have to start at 1%, increase your savings a little every time you receive a raise before your first paycheck at the new rate. This way you won’t miss the money because you haven’t seen it and your savings grow.

In Luke 14:28-30, Jesus shares the importance of financial planning. If you want to build a tower, you first sit down and decide how much it will cost, to see if you have enough money to finish the job. If you don't, you might lay the foundation, but you would not be able to finish. Then all who would see it would make fun of you, saying, 'This person began to build but was not able to finish.' (NCV)

Instead of a tower we are building our lives and futures. What’s more important? Paying bills on time and having enough money to live? Or splurging on a $300 pair of shoes because they are a name brand and on sale? Its one thing to eat PB&J for a week to buy an outfit but quite another to get evicted because you wanted a big screen TV. Make your budget primarily static with a little fluidity. I recommend a personal section that is flexible. One month it could be used for movies or concert tickets, the next month an outfit. This way you do not feel deprived about but are confined in your spending. Any left over money is not for end of the month splurging; you should put it in your savings account. Even if it’s a seemingly negligible amount. Over the course of a year you’d be surprised how spare change adds up.

Roll Call

The first tip in achieving the Cheaper Life is to take inventory. This may sound simple but it’s an important first step. Most people don’t know what they own. They have a general idea but not specifics. Taking and maintaining an inventory of your possessions will save you money from buying the same thing or even similar things that are superfluous. For the overachiever a color coded spreadsheet is optimal but for regular people a simple list by category will do.

People often do this on smaller scales. For example, making your grocery shopping list while going through your kitchen to see what you have and what you have need of so as not to be wasteful or miss something important. I suggest you do this with other areas of consumption. Besides groceries, I recommend taking clothing/accessories, linen, personal/cleaning products and entertainment inventories.

Inventory lets you know what you have (e.g. 5 pairs of shoes) but it also lets you rate the expected life of said items. Knowing that 4 pairs of those shoes have varying levels of wear and tear in them will help you realize you need to buy replacements before it’s necessary to spend money to replace all 4 at once. Accessories and linen are comparable. Personal items like deodorant and cleaning products are another area where money can slip through your fingers if you totally run out and have to buy in haste from a more expensive outlet.

One of my favorite areas of inventory is entertainment. I learned this lesson at an early age. My dad (who I love greatly) is an extreme movie buff. Movies provide fun and relatively inexpensive entertainment and he has hundreds of movies spanning from beta max tapes through DVDs. The problem with his obsession is that he would buy the same movie more than once because he doesn’t know what he already owns. There have been several times where he came home with a new movie all excited and us kids run to see what it is only to have our hopes dashed at the realization we already had that movie. I know it won an Oscar but honestly one copy of U-571 is enough let alone three. Not taking inventory wastes money whether you return the item or not. If you don’t return the extra item you are out of the entire cost. If you do return the item you loss time, gas and or postage to send the item back.

The American Dream

One problem with life, liberty and the pursuit of happiness is that it costs money. I know true happiness is free, yet what we are taught from infancy in front of televisions with psychedelic dinosaurs, glorified sock puppets and a clown packing lunch is that things are part of that happiness. It’s our right as Americans. A house with a picket fence, 2.3 kids and a dog is many people’s perception of “making it”. The modern 40 acres and a mule.

Is it wrong to want things? Of course not, as long as the want of things is in proper perspective. I Timothy 6:8 says but, if we have food and clothes, we will be satisfied with that (NCV). How many of us are actually satisfied with food in our stomachs and clothes on our backs? Sadly, I probably couldn’t name one person in America including myself. I can name several in third world countries (mission trips rock!). Verse 6 is even more startling to the American world view, serving God does make us very rich, if we are satisfied with what we have (NCV).

In my attempt to be a God-loving Jesus-freak (da da da dum da da!) Super Christian (yes I’m doing the superhero pose with one knee and fist pointing upward) I tried to reconcile what God says with what the world says. Guess what? It doesn’t reconcile. So where does that leave me. In a very good place actually. God created the earth as our (human) domain. Adam and Eve kind of blew it but Jesus took care of that. As believers we have our dominion back. No, that doesn’t mean you can roll up to any house in the Hampton’s and lay heavenly claim but you can live the heavenly life even if you’re in Hyattsville.

In upcoming posts I will give tips about saving money, shopping smart and following Godly principles which will all help you live the cheaper life. For the bougie out there, cheaper does not always mean lower quality. And higher quality does not always mean better.