Say the word “budget” and many people automatically think “restriction” or “deprivation”. But you know what? Budgeting is not like dieting. It’s not something you “go on”, and it’s not in place temporarily because you need to achieve some other goal.

A budget is just a plan for how you want to handle your money — so you can get the things you want in life.

About that diet

When you go on a diet to lose weight, you restrict yourself to eating less than normal or to only eating certain kinds of food. You’re doing it specifically to address an issue (weight gain) that you want to resolve.

It’s all about willpower and deprivation. It’s also a lot of work. You count calories, measure portion sizes, and look up a ton of nutrition information. But you struggle through it, because the result will be worth it, and of course it’s only temporary. You can’t wait to get back to normal again instead of only daydreaming about foods you can’t have. (Which of course is exactly why most diets don’t work.)

You might be thinking that sounds awfully similar to budgeting. Isn’t counting calories a lot like tracking spending? And don’t you cut back on spending when budgeting? Don’t you deprive yourself?

Not really. Here’s why.

Tracking your spending is a tool

When you track your spending, you’re doing it in order to find out where your money is actually going. You may think you already know, but if you’re not already tracking your spending, you’ll probably be surprised at the results. It’s a way to go from mindless spending to mindful spending.

And while it’s easiest to note down the things you’re buying and what they cost as you go, you’re not doing so in order to make sure you don’t exceed a certain limit like you would with counting calories. Instead, you’re doing it to identify money leaks or forgotten expenses. You’re doing it to figure out how to most easily get the things you want, and how to drop the things you’re no longer enjoying or getting value from.

What about cutting back?

When you’re getting out of debt, naturally you look for places to cut back. You want to put more toward your debt snowball so you can say goodbye to debt forever. So you probably do scrimp and save and cut back where you can. Maybe you even deprive yourself temporarily, avoiding things you’d really rather do or buy in order to have more money to put toward your debt. And all that is great, so long as you don’t over do it.

But that isn’t budgeting.

Don’t confuse voluntary austerity measures with budgeting. Many people do, simply because this happens to be the first time they’ve created a budget.

Budgeting is just a plan

Budgeting is really just a plan. Ideally, it’s a plan you’re so used to implementing that it just happens automatically. You can also literally automate a huge part of your budget by setting up automatic deposits and payments.

When you budget the right way, it’s about getting the things you want. Want to go to Antarctica in December? Figure out how much it’s going to cost you, open up a savings account, and start shoveling money toward that goal. Want to send your kids to college? Ditto.

What budgeting’s really like

Of course, you can’t do everything at once. If anything, budgeting is more like going to a restaurant and picking what you want to eat for dinner from the menu. You can eat anything you like, but you’ve got to decide what you’re going to eat right now. If you want to try multiple meals, you plan on a future visit.

And if you don’t have enough money for that special menu item, you either save up until you do, find a cheaper restaurant to eat at, or start making more money so you can hit up the 5 star restaurants on a more regular basis.

This is what budgeting really is: Getting the things you want without going broke in the process. And who wouldn’t like that?

To find this, look back over the last 10 or so times that you took on debt. What were you doing at the time? And what did you go into debt for?

It’s most helpful to actually look at your statement when you’re doing this, because we all have a tendency to forget things that we’ve borrowed money for.

What are your spending patterns?

For example, a look at your most recent credit card statement might show a bunch of charges for food. You might see a pattern there. Maybe you’re used to going out to eat every Friday night, and you do that without thinking, assuming that you’ll pay off that credit card debt as soon as it comes due.

Or maybe you notice that your charges are larger. They could be for things like car repairs, appliances, or electronics. Think back to what happened before you decided to charge those items. Had your car or water heater broken down? Or were you attracted by a “same as cash” deal that you saw while wandering through Home Depot or Best Buy?

Dig a little deeper

Once you see the obvious triggers, see if you can dig a little deeper. In the case of eating out, do you eat out because you’re harried and don’t have time to cook? Because it’s entertainment? Or are you just doing it out because that’s what you “always” do on a Friday night?

For car repairs, are they things most people would find very odd, like your car door falling off? Or they for more typical things, like brakes or tires? The same idea goes for appliances.

If you find yourself buying electronics or other luxury items, ask yourself what you were doing in the store in the first place. Were you bored? Deliberately trying to make sure you’ve got the latest and greatest? Rewarding yourself?

Why identifying your debt triggers helps

Finding out what triggers most of your debt gives you a starting point. Not for blame or excuses (“I had to borrow money because my car engine died and I work 20 miles away and there is no public transportation”); but for pointing out the areas that would be most helpful for you to work on (“I need a car repair fund”.)

In other words, once you’ve examined things a little deeper, you’ll have a better idea of where to start making changes.

You want to get out of debt. You dream of being debt free. You work hard at it, sending in extra payments and finding additional ways to cut back and bring in more money.

And sometimes, it still feels like you’re getting nowhere fast.

But you are getting somewhere — even if you’re having setbacks, or not seeing your balances go down as quickly as you would like. (Believe me, there were days when it seemed like our debt was only creeping down.)

That’s why it’s really important to nurture your debt free dream on a regular basis.

Spend time on your why

Think about why you’re getting out of debt. Imagine what things will be like when you are. Really picture it, write it out, or talk about it with other supportive people.

Think of yourself as a pioneer, only without the strong possibility of dying along the way. The pioneers had more than a goal: they had a dream. And they nurtured the heck out of that dream while they walked across America, enduring blizzards, lack of water, attacks, disease, and other hardships.

They kept going, no matter how hard things got. They continued putting one foot in front of the other, focused on that beautiful land and future they would have one day — and not the blisters they could feel on their rag-wrapped feet.

Don’t turn back

You don’t turn back when you’ve got a dream. You keep going. Sometimes, you rest and regroup for a few days. Sometimes you get sidetracked by how easy it might have been to just stayed home like those normal people back east who thought you were crazy for venturing out into the wild.

But then you remember what you really want.

Nurture your debt free dream, and you’ll enjoy the fruits of your labor when you get there.

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The flash points

Typically, there are three points at which you might feel like you’re never going to get out of debt: 

• When you’re just getting started in the process,

• When you’ve been struggling to get out of debt for a while without making much progress,

• And when you’re on the homestretch and that last big debt just seems to be taking forever.

So if you feel this way (or have ever felt this way), know that you’re not alone. Know also that it’s absolutely possible to get out of debt: people do it every single day.

Recognize that feeling for what it is

So it’s important to recognize that feeling for what it is: either a need for more information and guidance, or a desire to get that marathon over with.

If you’re staring at a mountain of credit card bills and getting overwhelmed, or if you’ve tried and tried to get out of debt without success yet, take a look at this article.

Chances are a solid plan is exactly what you need to turn that feeling of despair into success. (If you look at that and still aren’t sure whether or not you could repay what you owe, email me and I’ll be happy to plug your numbers into my debt snowball app and give you some suggestions on how it could work.)

Keep going

If you’re early in your journey, concentrate on how good you’ll feel when your money is really your own. And if you’re almost at the end of the debt marathon, for heaven’s sake keep going. You’ve already proven to yourself that you can do it, so don’t let up now. If you can, put on some extra speed instead by selling something or taking on a bit of extra work.  Recognize that feeling for what it is — being tired — and concentrate instead on the finish line waiting for you just ahead. 

You ARE gonna get that last one paid off.

According to the 2012 “Getting Paid in America” survey, approximately 68% of respondents said that it would be either “somewhat difficult” or “very difficult” to meet their current financial obligations if their next paycheck were delayed for a week.

That’s what’s called living paycheck-to-paycheck. It’s also why affordable monthly payments are an oxymoron. It’s like living in a house of cards that could collapse at any moment. I’ve been there, and it’s not fun. But it doesn’t have to be that way.

Are you living on the edge?

If you’d have difficulty paying your bills if you missed a paycheck or two, take a minute to figure out why. There are generally three major reasons for living paycheck to paycheck:

1. Your monthly bills are more than you can afford
2. You’re not making enough money
3. Or a combination of the above

Those sound obvious, but it’s easy to misinterpret what’s really going on, so digging a little deeper is in order.

Are your monthly bills more than you can afford?

This is a tricky one, because while the real answer is that your monthly bills are more than you can afford if you have to make monthly payments in order to buy the things you want, debt is so “normal” now that it’s hard to see that.

Also, you may be believe that they’re more than you can afford because you’re not making enough money. But unless you’re talking about being unable to meet basic needs (by which I mean food, shelter, and absolute bare-bones transportation) that’s probably not the case.

So here are a few of ways to see if monthly bills are the culprit: Are you only making minimum payments on them, or struggling to do so? Do the sight of your bills fill you with dread? Are creditors calling? If any of those sound familiar, your monthly bills are probably too high.

Are you making enough money?

Here’s an easy way to tell if you’re making enough money to meet your basic needs. Subtract all your monthly payments from your income except for groceries, electricity/gas, your house payment or rent, and gasoline or public transit costs. Do you have money left? If so, you probably do make enough money. You’re just overextended, which can be fixed.

Believe it or not, while it’s common to believe that you’re not making enough money, the reverse can also be true. Sometimes, people really aren’t making enough money, but they don’t realize it. If you’re making minimum wage, or a decent salary but have a good-sized family, that may be you. In that case, getting a better job while keeping your expenses the same can help immensely.

What to do

If you ARE living paycheck to paycheck, it’s critical to change your situation before that house of cards collapses. Take charge of your situation. That may mean breaking the cycle of debt, building up an emergency fund, getting a better job/a raise, or all three. Doing so can be a struggle at first, but it’s not as much of a struggle as living a life of anxiety or fear. And the struggle is temporary, because as you get your finances in order things will improve dramatically.