At You Need A Budget, we believe budgeting is about aligning your money with your priorities.

This doesn’t have to mean cutting expenses. But what I’ve seen time and again, is people beginning to budget, and wanting to shave their expenses. When you begin to think of your money and your priorities together, it is exciting to forego mindless spending or pass on something that isn’t that important to you, in order to move closer toward your goals.

And in many cases, shaving expenses means behavior change. This is all positive stuff—to a point.

At first, there will be obvious savings and they won’t be that hard to implement. Maybe you don’t need a Venti latte from Starbucks every. single. day. Maybe you could eat out less or wait on those new shoes or start streaming Netflix instead of paying for cable. Sure, it would be fun/easy/convenient to keep doing these things, but to let them go isn’t the end of the world.

The next layer of cutting might get harder and it may or may not be worth the effort. That is what you have to evaluate for yourself. It is different for all of us, but at some point you will be exerting exceptional effort for a diminishing return.

The next layer – well, now you’re into crazy territory. And crazy might be right up your alley and that is awesome. But it isn’t for everybody and that’s OK, too. You want to find the sweet spot—and only you can decide where that is—where you are focused on your priorities, and moving toward your goals, but still maintain enough flexibility to not burn out on budgeting or actually go crazy. (Not that there is anything wrong with that…)

I encourage everyone, at least once a year, to put everything on the table and examine it under a microscope. Really ask yourself what you care about most, where you want to be, and if you are spending your money on the things that really make you happy. It’s a healthy exercise, which can surface bigger issues, but at the very least, will help you stay focused, budgeting, and reaching your goals.

If you can’t wait until next week for more whiteboard wisdom, you can view the entire library here. If you have a question or an idea you’d like us to address in a future Whiteboard Wednesday episode – we’d love to hear from you! Email us at [email protected]

Until next time…