Building A Budget


After four years of hard work to obtain bachelor degrees, we found ourselves over our heads in student loan debt. I had over $70,000 alone for four years of rent and out-of-state tuition. Add Chase's in-state tuition/rent costs and we had a whopping $102,000 of debt. In the past five years, we also purchased three vehicles, an RV, and a house. We thought we'd never pay off our debt. Fast forward five years and we are nearly debt free (minus our mortgage).

One key to financial freedom is building your budget. We started tracking our monthly expenses right after graduation. It took trial and error but we finally formulated a budget that works for us. You can find a “sample budget" below just as an example.

The first step to building a budget is listing out all of your monthly expenses. You will have a mixture of "fixed" and "variable" costs. Fixed means that the cost will not change from month to month. Variable means the cost is subject to change based off of usage. When we make our expenses -- we always over-estimate how much something is going to cost each month. This is just one of our personal preferences because we always like to plan for the worst case scenario.

After you have your "expenses", you can look at your monthly income. Income may be fixed or variable depending on the type of job you have, whether you get holiday/overtime pay, etc. When we account for income, we under-estimate what we make -- again personal preference to make sure we can live on a lot less than we  actually make.

Once you have a list of your average monthly expenses and your income, you should have a good idea of whether you are breaking even or living below/above yours means. After seeing what remains at the end of the month, it’s a good time to re-evaluate your budget. Can you cut back on a subscription like Netflix or Sirius XM? Can you skip your daily Starbucks? All these little things matter! Building a budget that works for you and sticking to it is the first step to financial freedom.
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We’re Out N About
Lindsay + Chase


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