Your Budget is Broken - Here's How To Fix It

This morning I was playing around with the numerous different spreadsheets/trackers that the sort of people who get enjoyment out of such a thing tend to play around with when I had a LIGHTBULB moment.

Ok, not really. I'm not sure I ever really get lightbulb moments at all as my brain tends to be constantly pulling me in different, often useless directions anyway.

But what DID HAPPEN was I had a realisation that I think many may resonate with. I think, in fact, this realisation may be the very thing that's stopping way too many people get control of their finances, establish a workable budget and begin saving and investing for their future goals and dreams.

It's possible to spend so much time working out the numbers that you forget to work on the lifestyle, and before you know it the lifestyle and the numbers just don't add up.

Bear with me. It's clear that, for the most part, we unanimously agree that we need money. Most people spend the majority of their adult life working in some capacity or another, with 75% of working age adults employed part or full time in 2024. What's interesting are the stats on what we do with that money.

According to the ONS (Office for National Statistics) 2024 survey of household savings, two-thirds of adults believe they wouldn't last three months without having to borrow money if they lost their job. A third said they wouldn't last a month. How many people trust their employer enough to sleep easy knowing that?

This isn't a dig in any way at people earning a low wage, either. The fact is, with 75% of the UK employed and the median (not average) full-time salary in 2024 being close to £40,000, one could realistically (and sensitively) suggest that there are some in the 'wouldn't last a month...' camp (and definitely the three month camp) that probably just spend too much vs what they earn.

If this is you and you're happy, content and secure then that's brilliant. You've already arrived and I salute you.

If instead however you're thinking, 'Right, so I've got my budget in place, having gone through all of my expenses and worked it out as tight as sanity allows and I still don't seem to be able to save much - will I ever get to where I want to be?' it might be time to put the spreadsheet down and take a different approach.

The numbers don't lie

The sad truth is, if you've been honest with yourself regarding what you earn and what you spend, there probably isn't much you can do to instantly change the numbers. Of course, there are a few small things here and there that might help you get started. You might even be able to get a raise at work or have a strop at your phone provider to negotiate a lower monthly payment.

What you really need to do, however, is have a good hard think about what it is that makes you feel happy and fulfilled in life that doesn't cost any money, and do more of that.

Sound woo-woo, condescending and simplistic all at the same time?

Maybe, but hear me out anyway.

Let's go back to me this morning looking at my budget for no real reason. I thought it would be fun (shudder) to go over all my numbers and look at my spending over the last couple of months and see if anything needed tweaking, if anything was drastically out of line if you like (which is really important to do every now and then, particularly if your earning changes or spending fluctuates).

I realised (not for the first time) that it really is the simple act of just looking at the things you do that either cost or don't that gives you one of the clearest pictures you can get of whether your spending aligns with your values.

I'll give you a brief insight into the last couple of months of my life to help paint the picture.

I've been away for a cheap but incredibly special and fun long weekend with my fiancé (including a proposal to said fiancé!!!), ran miles and miles along muddy fenland trails, had numerous evenings learning and playing board games with family and friends and read so much Joe Abercrombie I've actually started thinking in a gravelly grim-fantasy voice.

Total spending = pitifully low

Total meaningful, joyful living = EXTREME

I've also however spent countless hours sitting on a commuter train into London to attend questionably useful University days as well as drunk far too much definitely horrific University coffee and eaten far too many anaemic sausage rolls (Sorry Greggs...) because I wimped out on taking my own cheaper and far more delicious coffee and snacks.

Total spending = essentially all of my discretionary spending

Total meaningful, joyful living = YIKES...

Fixing the Broken Budget

So what's my point?

Sometimes, we feel down in the dumps about our finances and whip out the budget, staring at it and willing it with every fibre of our being to change in front of our eyes, leaving us with thousands to save and spend on the lifestyle of our dreams.

What is much harder to do, but so much more powerful, is to look at your lifestyle and ask yourself whether it aligns with your values, dreams and goals (financial or otherwise).

For me, realising how much time, money and energy you can waste sat on a train next to someone who prefers your leg space to theirs will inevitably inform my future choices regarding where I live and work (will a huge house and a city-based job actually make me happy, or more miserable?).

In the same way, the joy I get out of reading an incredible book or taking a coffee on a long muddy dog walk with my closest reaffirms my money mindset, helping me not spend on things that don't make me any happier or bring any value or meaning into my life - why would I when the things that make me feel the best are cheap, or even better, free?

If you think I'm asking you to not spend a penny on anything in order to be financially free then you've missed the point. All I challenge you to do today is look at your spending and ask yourself whether the things you spend money on are bringing value to your life, in all the many forms that value might take, or holding you back.

If you spend some time mindfully realigning the way you live with your real values and what truly makes you happy, you might find you've magically created a lot more room in the budget than was there before.

Let me know what you've done this past month that has made you feel real joy AND contributed towards your future financial freedom!

Until next time.