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Home › Articles › General Family Finance › Beating the W-2 Blues

Beating the W-2 Blues

8 (Surprisingly Painless) Ways to Achieve Financial Sanity This Year

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"If you don't control your money, it will control you," she says. "It will cause strife in your marriage, crush you under a load of debt and force you to toil your life – and maybe your health – away to pay off that mountain of bills. When you look at creating a budget that way, you'll see that it's not a straightjacket at all. In fact, it liberates you."

Once you get serious about getting a handle on your finances, the process is surprisingly easy.

Don't call it a budget.
Call it a cash flow statement. Like the word diet, "budget" has gotten a bad rap. It suggests deprivation. So change your terminology, McCurdy says. "A cash flow statement is actually empowering," she says. "It suggests that your life can be run like a business. And it can be: a profitable and deeply rewarding business. Your cash flow statement is nothing more than a tool for helping you get what you really want out of life – your dream home or a family trip to Europe or an early retirement – rather than watching your money trickle away one $7 latte at a time."
 
Starting right now, write down every cent you spend for the next month.
That's right. Record every gallon of milk, every tank of gas, every daycare check, every sweater or book or DVD that you "impulse buy." Write them down every day so you won't forget. Try to live "normally," rather than being more conservative than usual just because you're doing this exercise. If you're married, have your spouse record all of his/her expenditures as well. Then, at the end of the month, you simply add up all the numbers. "For many people, this is the scary part," McCurdy says. "It's almost as though if they don't total up the numbers they don't have to face the awful truth."

Oh, and if you want to postpone this exercise because this isn't a "typical" month – you know, because you had to buy that pricey Valentine gift or put new tires on the car or take the dog to the emergency vet when it got the cheese wrapper stuck in its throat – forget it. No month is "typical." Any good budget (excuse me, cash flow statement) accounts for unexpected expenses.


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