Budget Like A Boss: How to Use a Paper Planner to Take Control of Your Finances

As a busy mom, managing your finances can be a daunting task. Between work, taking care of the kids, and keeping up with daily tasks, it’s easy to put off financial planning. However, taking control of your finances is essential to achieving financial stability and security. In this article, we will explore how to use a paper planner to create a budget, track your spending, reduce your debt, and create healthy spending habits. This will give you the tools and knowledge to take control of your finances, budget like a boss, and build a brighter financial future for yourself and your family.

Creating a Budget

A. Setting financial goals

To set financial goals, start by identifying what you want to achieve and when you want to achieve it. Write down your goals in your Goals Insert and break them down into smaller, manageable steps. Keep this insert in your financial planner so you can easily monitor your progress regularly and adjust your goals as needed. Remember to keep your goals specific, measurable, achievable, relevant, and time-bound (SMART) to increase your chances of success.

B. Calculating income and expenses

Calculating your income and expenses is an essential step in creating a budget. Here’s a simple explanation on how to do it:

1. 1. 1. 1. Determine your total monthly income – This includes all sources of income, such as your salary, bonuses, alimony, child support, and any other sources of regular income, like side hustles or other small businesses.
         2. List your monthly expenses – This includes all of your monthly bills and other expenses such as groceries, transportation, entertainment, and any other regular expenses. Be sure to include annual or quarterly expenses (like property taxes) by dividing them by 12 months.
         3. Categorize your expenses – Group your expenses into categories such as housing, food, transportation, insurance, debt payments, and other discretionary spending. Pro tip: I created a tip-in for my financial planner so that when I’m tracking my spending, I can easily check my categories so that I remember which category it should be applied to.
         4. Add up your expenses by category – Once you’ve categorized your expenses, add up the total amount spent in each category.
         5. Subtract your expenses from your income – Subtract your total expenses from your total income. If the number is negative, it means you’re spending more than you earn, and you’ll need to adjust your spending or income accordingly. Let’s hope that number is positive though! That would give you additional funds to allocate towards savings or additional debt reduction.

By following these steps, you can gain a clear understanding of your income and expenses, and begin to create a budget that fits your family’s needs and financial goals.

C. Allocating funds for each category

Now that you have an idea of what your income and expenses are, you can set budget allocations accordingly. Maybe you want to spend less money on eating out and more towards debt reduction. Set your target levels for each category. Keep in mind that if you are reducing how much you want to spend on a category, you need to create an action plan to be able to meet that number. Are there things that you can do to change your spending habits to meet your new targeted amounts?  In the past, we have cancelled things like satellite (or cable) television, been intentional about eating out less often, ensuring that we shopped with coupons and sales, etc.

Use your Budget and Bill Pay Insert to document your monthly budget and easily track to make sure bills are getting paid on time.

D. Monitoring and adjusting the budget

Here’s the important part, my friend. Once you have your budget set, the only way you’re going to know if you’re meeting your budget is by monitoring (i.e. tracking) your spending and adjusting where necessary. I have previously done this tracking on spreadsheets, but I find that by forcing myself to physically write down my purchases in my Purchases and Spending Insert, I’m less likely to make unnecessary online purchases (one of my bad habits). I highly encourage making this a daily task, just to keep it manageable. Spend five minutes in the morning writing down transactions made the previous day, or write them down at the end of the day if that works better for you. By making this a daily activity, you’re keeping your spending habits in the forefront of your mind, which helps you keep your financial goals in mind as well.

You may find that you need to make adjustments to your budget…or to your spending habits. 😉 I encourage that you have a weekly financial meeting with your spouse (or with yourself if you’re not married) where you add up all the spending by category and report out your month-to-date numbers as it relates to the budgeted amount. This will help you visualize how your spending is going for the month and allows you to more quickly make corrections where needed.

Let’s chat a bit about what it really means to track your spending, as it’s more than just writing down all of your transactions.

Tracking Your Spending

Identifying your spending habits is an important step in tracking your spending and taking control of your finances.

Here are some tips to help you identify your spending habits:

1. 1. 1. 1. Keep track of your expenses using a spending log – Start by tracking your expenses in your paper planner (I recommend the Purchases and Spending Insert). Write down everything you spend money on, including small purchases like coffee or snacks. Seriously, write them alllllll down. Even those silly games on your phone.
         2. Categorize your expenses – Once you’ve tracked your expenses for a few weeks, categorize them into groups such as housing, food, transportation, entertainment, and other discretionary spending. These should match the categories you used for your budget.
         3. Analyze your spending patterns – Look for patterns in your spending habits. Do you tend to spend more money on certain categories than others? Are there certain times of the month when you tend to spend more money?
         4. Identify your triggers – Think about the reasons behind your spending habits. Do you tend to spend money when you’re stressed or bored? Do you tend to overspend when you’re shopping with friends or family? I am definitely a stress-shopper, but knowing that I will need to show those purchases to my husband when we have our weekly chat makes me think twice before I just swipe my card. It’s not even that he would actually care…but it forces me to slow down and remember the long-game as it relates to our financial plan. Those small meaningless purchases add up over time and can really derail your financial plans.
         5. Set realistic goals – Based on your analysis, set realistic goals for reducing your spending in certain categories or avoiding certain triggers. This might even be a great opportunity to open up those communication channels with your spouse so he can understand more of your thought processes as well and can provide you support where needed.

By following these steps, you can gain a better understanding of your spending habits and begin to make changes that will help you achieve your financial goals. Remember to track your progress regularly and adjust your spending habits as needed.

I suspect many of us have debt reduction as one of our big financial goals, so let’s chat about that a bit more.

Reducing Debt

A. Prioritizing debts

There are a few methods debt reduction strategies that you can use to pay off debt. We’ll talk about those in a little more detail in just a bit, but regardless of which method you choose, you need to have a prioritized list of debts. Absent any other considerations, make a list of your debts, starting with the highest interest rate debt and working your way down. Prioritize paying off debts with the highest interest rates first, as they will cost you the most in the long run.

You may need to prioritize debts for reasons beyond what is best long term. You may have some that are past due or in collections or otherwise need to be moved to the top of your list. We want to avoid things like repossession and foreclosure, right? Although you may also need to consider whether you should down-size your home or trade your car in for a less expensive vehicle, so make sure you consider things like that when creating your budget as well.

Now, you may have a couple smaller debts that can be paid off immediately. For me, if I can pay something off in full in a single payment, I will often do that just to knock it off of my list. That also gives me a boost of confidence knowing that one debt has been paid off….and gives me motivation to get the next one paid off as well. Sometimes, those quick wins can help you gain momentum to work harder towards getting the next one off of your list.

B. Creating a debt payoff plan

Our Debt Repayment Insert is a great way for you to create your debt payoff plan and track your progress. By having a plan of which debts to pay off first, how much to pay each month, etc. you are more likely to actually execute that plan. This insert gives you a place to track all the information regarding each debt, including interest rates, minimum payments, payment due dates, etc. so that you can make a more informed plan as to which ones to apply additional payments to each month.

If you have multiple debts with high interest rates, consider consolidating them into a single, lower interest rate loan. This can simplify your debt payments and save you money on interest over time.

If you’re struggling to make your debt payments, consider negotiating with your creditors to lower your interest rates or set up a payment plan that works for you.

C. Utilizing debt reduction strategies

Here are three debt reduction strategies to help you create a financial plan on paper:

1. 1. 1. 1. Debt Snowball Method: The debt snowball method is a popular debt reduction strategy that involves paying off debts in order from smallest to largest, regardless of interest rates. This can provide a sense of accomplishment and motivation as you pay off smaller debts first, leading to momentum to tackle larger debts. Start by making minimum payments on all debts except for the smallest one, which you pay as much as possible while still making the minimum payment on the other debts. Once you pay off the smallest debt, move on to the next smallest, and so on until all your debts are paid off.
         2. Debt Avalanche Method: The debt avalanche method involves prioritizing debt payments by interest rate, with the highest interest rate debts receiving the most attention. Start by listing all of your debts in order from highest to lowest interest rate, and focus on paying off the highest interest rate debt first, while still making minimum payments on the other debts. Once you have paid off the highest interest rate debt, move on to the next highest, and so on until all your debts are paid off. This method will save you money on interest charges over time.
         3. Balance Transfer: A balance transfer is a strategy where you transfer high-interest debt from one or more credit cards to a new credit card with a lower interest rate. This can save you money on interest charges and make it easier to pay off your debt. However, be aware of balance transfer fees and make sure to pay off the balance before the promotional period ends and the interest rate goes up.

Remember, the key to reducing debt is to create a budget and stick to it, make extra payments when possible, and avoid taking on new debt. Choose a debt reduction strategy that works for you and stick with it. By reducing your debt, you can achieve financial stability and freedom.

D. Sticking to the plan and monitoring progress

As a busy mom working on your financial plan, it can be challenging to stay on track with your goals. However, it’s important to stick to your plan and monitor your progress to achieve financial stability and freedom. Remember, small changes can lead to big results over time. As motivational speaker, Zig Ziglar once said, “Rich people have small TVs and big libraries, and poor people have small libraries and big TVs.” In other words, focus on investing in yourself and your financial future, rather than immediate gratification. Consistency is key, and as financial expert Dave Ramsey says, “A budget is telling your money where to go instead of wondering where it went.” By sticking to your plan and monitoring your progress, you can achieve your financial goals and provide a better future for yourself and your family.

Developing Healthy Spending Habits

A. Identifying impulse buying triggers

Impulse buying triggers can vary from person to person, but some common triggers include:

1. 1. 1. 1. Emotional state: Feeling stressed, bored, or anxious can lead to impulse buying as a way to cope with these emotions. 👈🏻 THIS IS ME!!
         2. Social influence: Seeing others make purchases or feeling pressure to keep up with trends can lead to impulse buying. Come on friend, we all know that we don’t need to keep up with the Jones’ anymore!
         3. Sales and discounts: Feeling like you’re getting a good deal can lead to impulse buying, even if the item isn’t something you need or want. 👈🏻 THIS IS ALSO ME!! I love a good discount, but it’s important to bounce that deal up against your overall financial goals and determine if you actually need the item. I guarantee you there are things in my house that still have price tags on them because they were something I got a good deal on but I didn’t actually have a need for it.

To get impulse buying under control, here are some tips:

1. 1. 1. 1. Recognize your triggers: Take note of when you’re more likely to make impulse purchases and try to avoid those situations or find alternative ways to cope.
         2. Create a list: Before heading to the store, make a list of the things you need and stick to it. Our Shopping List Insert is a great way to do this! The Meal & Grocery Insert is my favorite for keeping me on track at the grocery store.
         3. Wait it out: If you see something you want to buy, take a moment to think about it before making the purchase. Ask yourself if it’s a necessary expense and if you can afford it.
         4. Use cash: Using cash instead of credit cards can help you stay within your budget and avoid overspending. Our Cash & Coupon Pocket is PERFECT for creating your cash spending budgets with six pockets to keep your cash organized by category!
         5. Practice mindfulness: Before making a purchase, take a moment to consider how the item will fit into your life and whether it aligns with your values and goals.

By understanding your impulse buying triggers and taking steps to control them, you can create healthy spending habits and stay on track with your financial goals.

B. Setting spending limits

Now if you’ve already created your budget, you should have your spending limits by category. Keeping those limits in mind when you are making purchases and having a good understanding as to where you are in those limits is important for maintaining your budget. It takes a disciplined mindset to be able to say “no” to a purchase when you know you have reached the limit for that category for the month. Remember, those limits were set by you for your overall good, so don’t let a momentary desire for something outweigh your long term goal. Stick to your limits!

C. Planning purchases in advance

We talked about this a little bit as one of the ways to help get your impulse buying under control, but it’s important enough to talk about on its own. Pre-planning your shopping trips is important when it comes to sticking to your budget. It also allows you to do some price competitive shopping to ensure that you are getting the best deal for the product. Take a few extra minutes to see which stores are having sales on the items you are looking for and make a shopping plan to get all the things you need at the best overall price. Use one of our Shopping Inserts to plan your shopping and then stick to your list!

D. Celebrating milestones and successes

Celebrating your milestones and successes is important! This keeps you motivated to continue pushing forward. Financial planning is no joke and it can be quite challenging. By celebrating your wins along the way, you’ll be motivated to continue making disciplined and sometimes difficult decisions to keep you on the path to financial freedom. Keep in mind that celebrations don’t have to cost a lot of money. Rewarding yourself for paying off debt by taking an elaborate vacation on a different credit card isn’t helpful in the long run.

Taking control of your finances can seem overwhelming at first, but by using a paper planner and following these simple steps, you can build a brighter financial future for yourself and your family. Remember to set realistic goals, track your progress, and celebrate your successes along the way. With dedication and perseverance, you can achieve financial stability and security, and create the life you’ve always dreamed of. I believe in you!

For more information on creating your organizer to hold your new financial plans, check out The Beginner’s Guide to Creating a Personalized Planner.