When I graduated college, I was unemployed for the summer. I mean, I had signed a job contract, but I wasn’t starting for almost three months.
Throughout college, I knew I had taken out some loans, but I wasn’t sure what the total was.
When I moved to Baltimore in August 2015, I had no idea who I owed and how much money I owed each of them.
When I first sat down to make a budget, I sat down with a list of the different categories that people spend in and I allocated a certain amount of money to each of them. I want to spend $200 on restaurants and $60 on manicures and whatever groceries I want whenever I want, so let’s call that $300. Then, at the end of my sheet, I added up what I wanted to spend and it came to three times my salary… so that wasn’t going to work.
It took me a little bit, but I got a handle on everything and made a budget. And that’s the first step I took towards discovering my own financial health.
There is no one right way to do personal finance. It is, after all, personal. Some people believe in no debt. Other believe in leveraging debt. I’m not here to tell you what to do or what not to do. Hell, I’m not even sure where I stand on the issue, fully, as I grow and discover what I can. I know what my goals are right now, but I don’t think there’s a one size fits all plan.
Here’s an example:
I often talk about how I’m working to repay my debt. I’ve referenced Dave Ramsey and his baby steps before. Heck, I’m even planning on taking Financial Peace with Casey really soon. But I don’t follow his plan to the detail. I invest 4% of my income into my Roth 401K at work to the point so that I can get my company’s full match. To me, if I invest 4% and get a 100% match on that, that is more than I am paying in interest for any of my debts, so that is worthwhile. That is not to say that Dave Ramsey is wrong, it’s just that his plans do not align with me right now.
And that is financial health. I can make a decision on my financial actions based on facts. I have an understanding of my financial situation. Being financially healthy isn’t doing one thing or another. It’s making the best decision for you based on you situation. You can only make the best decision when you’re fully aware and in an understanding of what your financial situation is. I listen to money podcasts all the time and too often people ask for guidance about how to figure out their debts. Many condemn that behavior as irresponsible, but I applaud it: at least people are trying to better themselves.
Checking in on my budget is like going for a run. It’s the little step that helps keep me from gaining all my weight back. Reevaluating my budget it the pushups I do that push myself toward bigger goals. Setting goals gives me something to work toward. You’re never in the best shape of your life, but you can always be working towards the best shape of your life- in fitness and finances.
This post is part of the CFSI #FinHealthMatters Blog Post Contest. You can see details here.
Emilie is an Army Wife, Data Engineer, and CrossFitter with a love for working through her thoughts in this space on the internet. She lives with her husband Casey and their pup Bo in Savannah, GA.