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Retirement Planning

Have You Mastered Both Sides of the Financial Equation?

I’ve never really enjoyed math, so I guess it’s not surprising that I just can’t seem to master both sides of the financial equation: increased earnings and low spending.

Human behavior, particularly my own, can be really frustrating at times. When I started living on a budget a couple of years ago, I was very, very careful with my money. For the first few months I stuck to my budget very diligently each month. Even still, I wasn’t making a huge dent in my debt because I didn’t have that much money to throw at it beyond the minimum payments.

During this time, I really had the budgeting side of the financial equation figured out. If I was ever over budget it was only by a small amount in the eating out category. (Go figure, right?)

Fast forward a few months and I started freelancing so I could earn more money and pay off my debt quicker. In my mind, this was how I was going to get ahead, by mastering both sides of the financial equation – high earnings and low spending.

Instead of throwing every extra penny toward my debt though, I used freelancing as an excuse to order pizza or go out to eat more often because “I didn’t have time to cook.”

Then as my online income picked up even more and surpassed the point that I could eat away all of my income, I got lax in my other areas of my budget. I started spending more on clothes and shoes again, I started spending on things for my house that weren’t 100% necessary, etc.

In fact, last month I made over $4,000 online which is more than I made at my day job and yet I still wasn’t able to put very much “extra” toward my debt because of increased spending, aka lifestyle inflation.

I decided that this month, November, would be the month I changed that behavior. Then I went out-of-town for the weekend.

I only did a little shopping for myself. I picked up a couple of pairs of yoga pants and pajama pants and one new long-sleeved shirt. I also didn’t watch my travel budget very closely while I was gone and I ended up driving into the city with my BFF on Saturday which resulted in extra spending on gas that I hadn’t budgeted for too. Those things combined with the Christmas presents I picked up for my friends and family lead to over spending my budget and not being able to save money for paying toward my debt once again.

What is wrong with me!?

I say I want to be out of debt, and I do, but then I go and blow my “extra” money every month which makes my debt progress very slow and sometimes non-existent.

Now that I’ve finally got the earning side of the financial equation working in my favor, I can’t seem to get my spending back down to create a surplus for debt every month.

This is very frustrating to me as I start off every month with the best intentions and always wind up over spending all of my “extra” money.


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Erin Thompson

Erin Thompson spent years managing her own blog about budgeting and debt. Because of that, she has great insights not only about managing spending and borrowing but also about running websites profitably. When she's not writing articles for us, she's traveling and looking for new types of wines to try.
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