Hello dear ladies of Hive!
It's been awhile since I've joined the ladies of Hive contest. When I found contest #169, I thought this is a good week to join the contest again. This week, the topic is right up my sleeve because believe it or not, I truly enjoy budgeting nowadays!
Although currently budgeting is one of my favourite topics, this has not always been the case. Like many others, I know how it is to live in poverty. I grew up with a single mother who didn't have much money to spend. The help of my grandparents and some of my uncles and aunts. We managed to get by. It was not easy though. Especially not for my mother.
Growing up in poverty
I've never been a demanding child myself in terms of needing expensive clothing and gifts. I think it was mostly hard on my mother, because she would have wanted to give me more. I remember at some point in my childhood she had a very well paid job and things looked better than it ever did. This also meant she went on a shopping spree and she gave me every expensive items she could find. And I was still thinking, why would you want to pay 50 euros for this kind of a top if you can buy it for 10 euros on the market? Nevertheless, it was good to see that she enjoyed Being able to afford the things we needed, with a little extra.
Growing up in poverty with a mother who has debts, I never learned much about money, sadly. Although I was very aware of the fact that people could end up in debt and that you can also buy cool second hand clothes, make clothes yourself (my mother was great at this), I never learned about the basics of money in general.
Mail ordering companies
My mother showed me the world of mail ordering companies, making it possible for her to buy things and spread the payments. To me this became normal seeing this all my childhood, if only she'd have warned me about the trouble you can get in and the high interest you pay if you spread the payments too long.
The right mindset is key!
I think the mindset matters here, it's not a bad thing in general to use them, if you know it frees up some money you need for something that has priority for a bit (such as unexpected hospital bill, broken car which you can't do without etc) but it's a dangerous area if you are not on top of your finances and aren't sure you can pay it back in time. I've had debts with these companies from 18 years of age, but thankfully, my mindset is not the same nowadays so I will never let things get to that point again.
I’ve been left without money, having to trade items gifted by others or given in-store while hunting for rotten spots on the fresh veggies and fruit and having to count every item while going for groceries, because I just had 3.65 euros to spend (for example).
How hard this time of our life has been, it also made me very creative and aware of money in general, which I'm grateful for. My mindset has never been the same since living in poverty as I never want to go back to that place again and I will do everything within my power to avoid it. So I believe that going through that has shown me the other side, making me more aware of the struggles people with a tiny (or barely any) budget are facing every day.
A clear view and goal is key
When we wanted to move back to Spain from Hungary in 2022, I had to have a clear view on our finances because quite a few factors were important to make this happen within the 6 months deadline I gave us. It was all on me to make that happen, my boyfriend could only give his time and effort to work so all the financial stuff around it was my game. Before creating the spreadsheet, I thought we’d never be able to make this happen within 6 months, maybe not even a year. I was wrong, so I found out when I started to actually SEE our incoming money and costs clearly in one sheet.
Hyper focused on a clear goal
I’m known for being able to make anything happen if I want it badly enough and something that I really wanted badly was to get out of Hungary and back to the tapa lifestyle in Spain as soon as possible. Seeing our financial sheet with some live editing every time a bill was paid or cash was used for groceries, it gave me such a confident feeling that I knew from the first days that we’d end up in Spain before June, exactly as I envisioned. Call me crazy for moving to the Spanish coast knowing the rental prices rise through the roof close to July, but I felt we’d make it in time and I trusted my gut feeling that this was the case. My gut was right, we made it in time.
Being on top of everything
For nearly six months, I was on top of our sheet every single transaction, when I budgeted something a bit too high and had spare change, I added it to the savings vault. Gosh, I loved using my vaults in my Revolut metal account so much, it became a game to me to free up as much as possible, haha. After succeeding paying off the credit card, overdraft and saving up enough for the trip as well as the deposit for a new home, I was so motivated to keep this going that I always kept using a spreadsheet for our finances.
It’s a spreadsheet that I edit when I see bills have been paid by bank, when money is taken from the ATM, I adjust budgets on the go when needed to make sure the balance is as positive as can be and I always try to go the extra mile to make sure the savings are something that makes me smile. I never feel bad when we have to take them out for good causes, such as recently where we had to move within a week as we were without water. This has upgraded our lives so tremendously that I can’t be too bothered, but I’m highly motivated to fill things up again every opportunity that presents itself.
Awareness is enough for me
For me personally, being aware of the sheet and financial status is enough to think twice when wanting to spend something that we don’t really need. I too fall for it sometimes though because I also know that these spontaneous moments when outside for a walk, and a tapa proposal are the best moments to spend together. I was really strict when working towards emigration while I let that slide a bit more in the past half year.
The other side is that my boyfriend is not that aware of what still needs to be paid and doesn’t want to check that constantly either so he proposes something and then I have to check is it ok or should we wait a bit longer if possible.. This has caused quite some arguments in the past until I explained to him that I just want the best for us and never go back to that moment where you need a few hundred euros for a car repair (for example) and not being able to pay it.
A good team
I’m happy to say that after a few years of being a bit stricter saying no, it seems I infected my boyfriend with the virus of not wanting to overspend. There are exceptions though, we’ve been neglecting ourselves for many years in terms of not doing fun things (first because we just couldn’t afford it, later because of the pandemic etc) and as we’re not getting any younger either, we approve a night out together more often now that we have a trustworthy person to watch our daughter. If that means I have to be tighter with groceries, so be it.
Time is valuable too
We both have learned to value our time together a lot because these are the moments that we truly connect and work on our future as well. If that means I have to skip some preferred items in the supermarket for a few weeks, so be it. I don't want to look back and think, shit, we had all this great stuff around us and we never took the time to explore this because it would have cost us a bit of money. Prioritizing things helps a lot, and planning ahead a bit.
Spreading quarterly and yearly bills
One of the bottlenecks I faced when we bought our car here in Spain was that we were told after we bought the car that the insurance was usually paid yearly here, while we were used to quarterly all our lives. On top of that, the insurance was also much! more expensive than our last one in Budapest. Ouch, I felt sick to my stomach that we spent all our savings on this car (it was a bit over budget, but definitely worth it and no regrets, ever!) and now I was facing a 650 euros bill for insurance. That was harsh, thank gawd for my HBD savings, they saved the day!
I was determined to not let that be a yearly issue anymore and started budgeting every quarterly and yearly bill into smaller bits so that it would never be such a huge cut in our budget anymore. This is probably one of the smartest things I've implemented in our budget.
Be your own bank!
Final tip is that having these savings vaults also means you can borrow money from yourself when you need something short term and know money will flow in again before you need these savings for a quarterly or yearly bill. This is how I managed to cover all our moving costs for new furniture as we needed beds and matrasses, I borrowed from our tax vault as I had several months to make up for the lending.
Let's stop writing right here because as you can see I can talk a lot about budgeting since I love it so much, but I don't want to bore everyone with an even longer read than it already is.
If you made it this far, you rock! :) Thanks @kerrislravenhill for this great question!
Did you see this week's contest? @hetty-rowan @saffisara ?