Without a doubt, one of my major stresses in 2015 was money.
Moving to Sydney introduced two new money factors that have drastically impacted my financial situation: 1) monthly pay *vomits*, and 2) doubled rent expenses. While I’m now earning roughly $2K more (pre-tax) annually than I was in Brisbane, this doesn’t alleviate the increased financial burden that has come in the form of exorbitant rent costs in Sydney. Don’t worry, this isn’t going to be a rant about renting in Sydney; I’m fortunate to be able to do what I love for work in a city that is comparatively close to my family and friends at home. It is what it is, and I’d rather be barely breaking even and fulfilled at work in Sydney than better off financially but not working in a job I’m truly passionate about in Brisbane.
The key point here is that I am barely breaking even. Or, I was prior to Christmas present shopping. I’m not utterly broke, I don’t have any significant debt beyond HECS, and I have the comfort of full-time employment and a regular salary each month, but it would genuinely feel wonderful to not live month to month. I’ve forgotten what it feels like to have money stashed away for emergencies, and my main financial goal for 2016 is to get a buffer of around $1-2K back into my bank account before the year’s end.
The easiest way to achieve this goal is to put away 10% of my monthly income each month. If I did that, I would easily reach the goal of $2K in savings prior to 31 December 2016. The problem is that if all my other lifestyle factors remain constant, simply stashing 10% of my monthly pay isn’t financially feasible; I would end up spending more per month than I earn and putting pressure onto my credit card, and that’s not what I want. Further changes have to be made.
Each month I’ll be working towards a different financial goal, and for January my primary focus will be restricting non-essential purchases wherever possible. I’m aptly naming it Just The Essentials January. Now, the way I define essentials will be vastly different to how others define it, so here are my ground rules:
- Paying for food, public transport, groceries, and utilities (phone, rent, health insurance etc.) is essential; however I am to continue my usual approach to all of these. That means not stocking up on more expensive groceries than I otherwise would, and other changes like that. Regular programming shall remain.
- Should something I use regularly run out or break, like medication or skin care, I will replace it.
- Should I get invited to a birthday party or something similar where a gift is required (I can already think of one coming at the end of the month), a gift can be purchased.
- Non-essential spending on clothing, eating out (beyond my standing weekly Friday morning breakfast date with Matt), makeup, books *gulp*, memberships, entertainment (i.e. cinema trips, drinking sessions), and homewares is to be restricted as much as possible. This is crucial, as this is where a significant portion of my regular non-essential spending happens each month.
I’m confident that I can stick to the points above, most importantly point four. I was spoiled over Christmas, but also I would like to work on understanding why I use shopping as an instant gratification mood-booster. I have so much stuff in my life and if I’m honest with myself I don’t really need more. If having a frugal start to 2016 means that my overall finances will be better off this year, then it’s an easy sacrifice to make.
If you have any goals for 2016, I’d love to hear them! If you have any tips on how to help me achieve my goal of restricting non-essential spending in January (and most likely for other parts of 2016 as well), I’d equally also love to hear them. Let’s take about our goals freely and openly to remain accountable and keep each other motivated.