Roughly 1 in 4 Americans don’t think they need a budget, according to a Credit.com survey. But making budgeting a monthly habit is what helped me retire from my day job in my 30s. Here’s the exact template I use to manage $1 million worth of assets every month. You can do it, too, no matter your income level, and surprisingly, it’ll take less than an hour a month once you’ve got it set up.
Forget the overwhelming minutiae and the drudgery of having dozens of line items on your budget to keep track of because that’s likely what bored you to tears in the past. Simplify your budget into three main buckets: Strive, Revive, and Survive.
Each of these buckets are all about living your best life, tailored to your unique preferences and goals. Think of this budget as a living, breathing representation of who you are and who you want to be.
Students in my CRUSH Club who weren’t budgeting believers have embraced the simplicity of the three categories. They see how the Survive part is relatively steady, while Strive and Revive require more planning and attention.
Someone should be able to look at your budget and know exactly what kind of person you are and what matters to you most. If that’s not the case, you’re highly unlikely to stick to it. Let’s dive into each of these buckets in detail.
Your Budget Starts With Survive
Survive covers the five essentials—housing, utilities, food, transportation, and health. These are nonnegotiable items, but we’re not dwelling on them because, well, life’s about more than just surviving. You may recognize these same five items from the cash flow cushion because they are exactly that — the basic bills you will likely pay regardless of whether or not you have income. Specifically this bucket includes your:
- Mortgage or rent and other housing expenses such as taxes and insurance;
- Utilities including your phone, internet and other modern-day services;
- Transportation expenses including your car payments, gas, parking or commuting costs;
- Food expenses no matter if you buy groceries, eat at restaurants or order delivery; and
- Health expenses such as household supplies, personal hygiene and medical needs.
This category should include expenses for everyone in your home including your pets, assuming you like them as much as I know all my pet-owning students do. Dogs are the new kids, right? As a big mental health advocate, I believe any related expenses such as therapy should also be included in your Survive bucket.
Revive Makes Room For Guilt-Free Spending
When I first started researching how to budget to pay off my student loans, a lot of the guides out there advocated for allocating for the items in the Survive bucket, with the rest expected to go pay down your debt. I tried that for a few months and wow, it was totally no fun. Even more importantly, I started to feel like giving up on budgeting altogether because I was tired of feeling deprived.
At the moment I almost ditched budgeting, I decided at least some portion of my budget needed to go toward enjoying my life, and for pursuing peace. The Revive category is where we indulge our desires, guilt-free. Vacations, hobbies, treats — it’s all fair game. This is where your budget really starts to look different from everyone else’s, and it should. You’re a unique human being after all.
In my Revive bucket today, you’ll find monthly massages, trips to see extended family members, yoga, dance classes and fashion. We used to feel bad about those things, but what’s the point of having money if you don’t enjoy spending it?
My CRUSH Club students are often surprised to find that I teach having revive as a necessary part of their budgets because those paying down debt assume they aren’t allowed to have any fun. But I learned that having a meaningful revive budget can actually help you spend less money overall if you’re intentional about your spending choices that genuinely make you happy or help you calm down.
Strive Is How You Achieve Financial Freedom
In Strive, it’s all about building wealth. It’s also what’s always overlooked in other budgeting templates. The vast majority of them focus on Survive, and a few make room for Revive, but very little attention goes to Strive.
The Strive bucket includes saving, investing, paying down debts — anything that moves the needle on growing your overall net worth. For example:
- Money you’re saving toward your emergency fund and cash flow cushion;
- Debts you’re paying off including extra payments toward credit cards, personal loans, student loans, car payments and mortgages;
- Investments you’re making in your retirement accounts, brokerage accounts or property;
- Education you’re paying for such as coaching, courses and certificates that can help you increase your income; and
- Business expenses that help you grow your revenue or increase your efficiency.
The word strive means to make great efforts to achieve or obtain something. So, it makes sense that this category should get most of your attention if you want to reach financial freedom.
Yes, it’ll take some upfront time and effort, like all good things do. But think of it as an investment in your financial future. Once you’ve got these three buckets in place, this template can serve you for life, whether you’re making $30,000 or $300,000 a year, or even more. I’m truly rooting for your success here.
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