WAYS TO EDIT THE CASHFLOW

Hi! Assalamualaikum.

Having trouble to set up a budget? Do not worry. We will do it slowly but surely okay. 

This time, I will share about the steps to set up our household budget.

When I say it's household budget, just let our spouse get involved with it. It will bring the merrier, yet the better family goals to achieve. 

EASY WAYS TO EDIT THE CASHFLOW

So, the steps are: 👇👇👇

1. Set-up a monthly budget party.

Is there a budget party? For real? Basically, it's a regular meeting with our spouse to talk about a household budget. Let's start with 1 family meeting per month. 

Just make it a party where we do what we need to do to make it fun. 

We can discuss the next month’s budget and also discuss how last month went. We can also talk about current goals, upcoming extra expenses like birthdays, any wins from last month and any areas of tension or frustration.

Don’t drag it on, we can try to keep it less than 30 minutes if possible. That's it!

2. Reward ourselves for sticking to it.

I consider this is a new habit. As I learned from the Power of Habit that to really make a habit stick, we should have a new reward to ourselves for completing a new habit.

If budgeting, frugal living, and saving money are new to us, then plan some simple, fun rewards!

It could be a fun family reward by simply going out to get ice cream with the kids. 🍦 Yummy!

3. Put our goals where we can see them.

Once we and our spouse have settled on family goals – post them out in the public. No, we don’t have to put them on Facebook. But we should put it somewhere we can see every day.

Use our goals as a daily reminder and encouragement of WHY we are doing what we’re doing.

This will motivate us to make choices that better align with where we want our family to go!

4. Track our spending habits.

I’m kind of a budget nerd and started tracking my expenses since January and haven’t stopped since. I went through ALL of our statements for five months.

While I don’t think all of us HAVE to do this, it is good to start tracking them from now going forward. I use a workbook to track mine. 

The CASHFLOW EDIT workbook allows me to write down all my transactions and categorize them based on my paycheck or salary earned. It is easy to see them on papers or book. Plus, I can see how much money is left in each budget category (and so can my husband!) in real time! 

5. Use the envelope system.

It’s proven that people are willing to spend more when they use their credit card instead of cash.

That’s why if we really want to crack down on our savings, grab these envelopes with Nafisah Amran catalogue, and head to the ATM. I'm sure we’ll be ready in no time.

I like that there are 48 envelopes in this bunch because I think the more detailed we can be on categories, the better we will be able to save money. 

For those who are about to begin, we could simply use 'sampul raya' as to create this new habit. But I started this with some zipper bags, which are also practical!

6. Create a budget binder.

For me, paper can really help us get organized initially. And many people THRIVE with this because they get away from their phones.

We can even throw our budget binder in the car, so after a purchase, all we have to do is log the purchase on our log and then add the receipt to the zipper bag in the binder! Done!

7. Log expenses daily.

The ONE habit that really made a difference for me when we first started budgeting was logging my expenses daily. Since I used the workbook and the budget binder, it was super easy to do because I could log my expenses right after leaving the store and it would auto-sync with my budget.

It only takes a few minutes every day if we spread-out! Once again, give ourselves a reward when we do this for a week straight.

8. Set-up auto draft.

When doing a budget, the banks are our friends. I love auto-payment and auto-draft. I don’t have to worry about paying any of my bills on-time. I simply make sure there’s enough money in my account to cover the bill and then I don’t have to worry about a thing!

I have set-up a few auto-payment for my insurance, loan repayment, mortgage, car loan and investment. It would be easy!

9. Brainstorm ways to save money.

In this case, it's quite hard for me at the first place. I considered myself as a big spender before. What I earn every month is what I can totally spend on. I never think of keeping some money for my future or unexpected things that might happen. 

But my husband is some kind of thrifty. He is able to save some money monthly in his account. As I got a bit envy with how much money he could keep in his account, I know I should do the same thing. 

My mistake was I let myself in for spending as self-reward. Especially new pair of shoes and handbag. 😅 That's why I then decided not to spend more on me, but to save more for my future. I allocate some money as my savings and start to have “no spend” days in my financial planner. 

We might find saving money is a bit challenging when we love shopping, right? But let's just think about our future first okay. I'm sure we can do this! 💪 

10. Meal-plan before we grocery shop.

The groceries and food can eat up a huge portion of the budget. I struggle enough to save SOOO much money each month when I actually meal plan and ONLY buy what’s on my list.

I end up bringing coupons, planning around sale items, and using up leftovers that are in my fridge when I actually meal plan.

11. Create a vision board

This is also a fun activity to do with the kids! Grab a poster board and some magazines. Think about what life would be like when we are debt free, not worried about money, and meeting our financial goals.

Now, look through the magazine and pick out all the pictures that have to do with this. Create a collage on our poster board as a family. Post this board somewhere to remind us of what we’re dreaming of!

12. Try to make a little extra money on the side.

If we’ve squeezed every last penny out of our income and it’s still tough to make ends meet without using a credit card, then consider trying to make a little extra side income each month. We can try one of these side hustle ideas: start a blog, resell items online, become an influencer or find freelance job.

Well, ready to start setting up the budget now? Just don't afraid to take the beginning steps. I'm sure we are able to work for it. 

Wallahu'alam. 

WHY WE TRACK SPENDING?

Hi! Assalamualaikum. 

I never realized that tracking my spending helps me a lot with my monthly budget until I started doing it.

THINKING BEFORE WE SPEND THE MONEY

At first, it's really difficult for me to track my spending. But, as I put in into my new habit, it's getting better.

"The person who doesn't know where his next dollar is coming from usually doesn't know where his last dollar went." - Unknown

SPEND THE MONEY WISELY 

It is really good for us to write down where our money is gone. Where it has been spent on? What we spent it for? 

Here are some reasons why we should track our spending:

It helps define our financial reality. Actually, we will never know how much we really have to save and spend unless we write it down. I like the concept of 'paper and pen' in writing down the spending. Tracking our spending puts our money on record so we know where we stand in our finances. When we’re financially aware, bringing out the budget planner in us becomes easier. After all, it’s hard to budget what we don’t know.

It identifies our spending habits. Basically, there are things we buy to make us happy, sometimes to relieve our stress. It could also be a reward for a month’s hard work or a small thing we have successfully achieved. Those things aren’t necessarily bad, but there is a fine line between rewarding and splurging. So when we track your expenses, we get a reality check to help us adjust for wiser spending!

It teaches us to prioritize. We’ll never run out of things to spend on. Think whether we really need that thing or we just want to have it. As we track our expenses, we get a clear picture of things that need to stay, and those we can do away (or at least, put on hold). Just remember our priorities!

Source: Google image

It forces us to save. When we track our expenses, we get a good, hard look where our money goes. And so it reminds us also when we exceed our budget. Although overspending isn’t exactly good news to celebrate, it’s an opportunity to re-align our lifestyle to our budget. So, just review our list, and learn to say NO to those impulse buys. It always pays to save, save, save!

It helps us protect our money. When we track our expenses, we become aware of suspicious financial concerns like money fraud that we don’t easily notice when we don’t track our expenses. We can be proactive and start doing something about it. Just be alert with our money so that we might not lost it for something that isn't necessary.  

Source: Google image

I tried to do the tracking from here. Just click and watch okay.

Waallahu'alam. 

SETTING A BUDGET

Hi! Assalamualaikum.

Sometimes, we can feel overwhelming when we think about the idea of budgeting.   

It just feels like the thought restricting our spending may be the last thing we want to do, right?

‘But a good budget isn’t about restriction or doing without. It’s about freedom.’ – well-said by Kumiko, the blogger of The Budget Mom.

Actually we manage to afford the things that matter most to us by doing a well-planned budget. So, let’s find out on how to start doing it. 

HOW TO START A BUDGET? THE BASIC STEPS:

We can increase our income

Even though we’re restricted by our income limits at this moment in time, it doesn’t mean we have to earn the same income level forever.

Each one of us has the potential to earn extra money. We just should ask ourselves if we’re willing to make the changes to our life that earning more money will require.

To earn more money, we can try getting a second job or pick up side hustles. Yes, there's sacrifice to be made for that choice. We may have to give up time doing something else we want to do in order to make the time earning more money.

We can decrease our spending and expenses

Another way we can do to improve our finances is to decrease the spending. I think this is where most people need to start. Honestly, I choose this option too.

We can only cut spending so much. Take that into account. We’ll still need the necessities like food, shelter, and clothing. No matter how tight our income is, there are often ways to find hidden money in our budget. 

Making the Choice

Decreasing spending or increasing income, which one would be the best option? Both work to help us create extra money in our budget. It depends on us to start with a choice.

Just ask ourselves. Are we going to try to cut spending and expenses? Do increasing our income will be a better fit for us?

As for me, I chose to decrease my spending. I don't have much time to come with committing a second job as I'm struggling with my main career and postgraduate study. So the second one is the best choice for me. 

Yes, it is quite hard at the beginning of decreasing the spending. I had to cut off buying my favourite stuffs and doing things I like to do. It is considered the sacrifice I made to live within my means. Actually, I'm also thinking about doing a side hustle but I just don't know what is the best thing to do. To own a small business, or become a freelancer? I still don't decide it. I hope there's a great decision to come. (Wish me luck, okay.)

Increasing our income may be the best choice if we truly don’t have any money left over after paying our essential bills (housing, transportation, food, etc.) and existing debts. However, most people can benefit from taking control of their spending as well.

If we are capable enough, some combination of the two strategies combined works best.

So, let's have a look on what financial situation we’re in currently. I believe there’s a way to make it better. Just bare in mind that improving our finances requires change, which isn’t usually comfortable.

Financial change, in particular, requires hard work, dedication, and a whole lot of determination. Plus, we may be faced with financial challenges that make the process harder or slower to get started. 

Wallahu'alam.