Have you ever looked in your wallet for the $20 you know you put in there only to discover that there are a few bills but they don’t add up to $20? Or maybe you’ve looked at the balance in your checking account to discover that there’s less there than you thought? Try as you might you just can’t recall what happened to that money! I know this happens in our house and I bet it has occurred in yours also.
Why? Because I have a hole in my bucket that money is falling through! When this happens once in a while it’s not a big problem BUT when it is a reoccurring event it can cause frustration and tension! Let’s chat a bit about 3 steps that can be used to fix the Hole in the Bucket.
Step 1:
Write down everything you spend for the next 30 days! This takes a bit of discipline but it really helps you see where your money is going. When I say write down everything, that’s exactly what I mean – EVERYTHING.
I’m not just referring to the cash you spend. Record anytime you swipe that debit card or write a check. If your married, it’s always a good idea to have your spouse participate in this adventure with you because maybe the Hole in Their Bucket needs attention also. Get a 3×5 card, open a new note on your phone, grab an envelope for receipts: whatever you choose, but find a way to record everything you spend for 30 days
Step 2:
At the end of the 30-day period of time take a look at your notes and group them into categories: food, transportation, clothing, bills, personal items, etc. and total each category. If your spouse was also tracking their money for the month you will need to look at their notes also. Are there totals that surprise you?
This is the Hole in Your Bucket. A note for the wise: now is NOT the time to be judgmental. (Rich uses the example that you might find out how much you’ve been spending at the convenience store for Snickers but sometimes a Snickers is a necessity so you won’t get hangry.)
Step 3:
Once you find the hole you have to decide if the extra spending is being used on a need or a want and how you might be able to adjust. At the end of the day, it’s your money and you can spend it anyway that you choose but sometimes we have to be adults and realize that the choices we make have consequences, even the choices regarding the Hole in Your Bucket.
Rich and I have found that once we identify the problem, we can work together to find a way to solve the problem. Your battle plan might include developing a budget, allocating a set amount of “fun” money for each of you to use or cutting the cord to cable or satellite TV. Whatever it is, put it into motion!
Well, that’s it: 3 steps to identifying the Hole in Your Bucket and how to deal with it. It’s not an impossible task and although it might show us some things we aren’t too proud of, it can also be an opportunity to start to take control of our finances and work toward the goal of financial freedom. If you’d like to talk about this a little more in depth, send me an email or give me a call and I’d be happy to help.
Until then, I think I’ll go have a Snickers!!