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Early last month, I had a visit from Silvia, a longtime friend. My friend had gone through several life challenges over the past several years, but Silvia is a survivor, and is still strongly standing. There had been a recent divorce, coupled with the loss of a high paying job. But she was excited that she had found another position in her same field of software development. However, Silvia is now living in a single income household, and her new job is paying considerably less than her previous position.
Silvia must come to grips with the reality of a new budget. In actuality, there had been no budget previously, so this is a new experience for her. While she laid checkbook, credit card statements and her life, open at my kitchen table, the experience was both cathartic and enlightening for Silvia, as spending history and habits were relived.
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My friend Silvia is a Starbuck’s junkie. It’s her habit to get up early in the morning, and on the way to work, to frequent a nearby Starbucks and order up her favorite Caffé Mocha. Along with it, there is sometimes a pastry purchased at the same time. Silvia was averaging nearly $140.00 a month at Starbucks - and that was on a good month!
Silvia is not able to commit to ending all her daily Starbucks trips. However, she is able to commit to cutting them in half, in favor of indulging a newfound interest in exotic teas, which she now brews at home, on some mornings. Starbuck’s savings per month for Silvia – About $70.00
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Among Silvia’s credit card statements, I noticed a monthly $44.00 charge for a health club, she told me she had belonged to for over 5 years, but hadn’t been to for well over a year. I had to ask, “Are you going to get with their program once again?” No, she had purchased a bicycle, and was doing a lot of her exercise free along the American River Bikeway. It was time to cancel the gym membership. Health Club savings per month for Silvia - $44.00
We talked about other areas in Silvia's living and spending habits, where savings might be explored and tweaked. In addition to the $114.00 monthly savings from her Starbucks and health club expenditures, we saw the possibility of significant enhancement of her budget fitness and wellbeing.
Although, I’m not a financial counselor, it doesn’t take rocket science to sit down with your check book and credit card statements, to see a pattern, of behavior, and expenses, which can often be easily changed. And in so doing create significant savings in a personal budget. During these difficult economic times, it can be empowering to explore these more fully, and implement changes to using money more wisely. What Silvia discovered was she truly did not need to give up her previous lifestyle as dramatically as she had originally thought! It was really about reassessing where she had been, and where she needed to be going. For that to happen it also required an honest assessment of where financially she currently was!
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