For all that is in the world - the desires of the
flesh and the desires of the eyes and pride in possessions - is not from the
Father but is from the world. And the world is passing away along with its
desires, but whoever does the will of God abides forever.
St John the Apostle
1 John 2:16-17
A record of what you have spent money often may
make for unpleasant reading but it is enlightening. Sort all of your spending
(every penny of it) into one of these four categories:
Survival costs. These are the things that you
cannot avoid paying for: rent or mortgage, water, electricity and gas, food,
essential transport, personal hygiene, medication and necessary communication
(like telephone). And, of course, the tax that pays for the public services we
take for granted.
Lifestyle choices. These are the things that give
expression to who you are and that make life more pleasant for you. They
include non-essential clothing and accessories, like jewellery and gadgets,
leisure activities and entertainment. I am not suggesting that these things are
unimportant, only that they are not as important as keeping a roof over your
head and staying healthy.
Impulse spending. These are the things that you buy
on the spur of the moment but, really, are not important to you. They often
include coffees, snack bars, alcohol, magazines and anything else you buy
without good reason, except perhaps that you are bored waiting for a bus or
train. They also include the things that catch your eye in shops, the ‘must
haves’ that, on reflection, are inconsequential.
Giving and saving.
You may not want to share this detailed information
with anyone else but the important thing is that you know the truth about yourself.
It is the essential first step in creating a budget.
If you are already in debt and need to get control
of your finances urgently, this detailed approach is a luxury that you cannot
afford and you should quickly collate the information you have (like the cost
of rent and electricity) and estimate the rest (such as the cost of food and
clothes). But if you are not in debt but wish to improve your lifestyle, fulfil
some ambition or live your life more sublimely, this is the place to start the
journey.
In weekends to come, we will look at:
- Creating a budget.
- Extending a budget (that is, using credit).
- Defending a budget.
- Rescuing a budget (from debt).
Along the way, we will digress to cover specific
issues, like work, banking, contentment, saving and generosity. But from the
start, think about how you may have made your life unnecessarily expensive or
complicated than it need be.
Postscript. It is
interesting that I should have planned to write about this subject at the end
of the week in which the music store HMV collapsed. The issue that seems to
have angered many of its customers is the store not honouring the gift vouchers
it sold over Christmas. While I understand the legal position, if it is true
that the store stopped selling them as soon as it knew it would have to call in
administrators, that would seem to suggest a very narrow use of the word 'know'
or that a lot of people there were in denial about its financial situation for
a long time. One of the benefits of a budget is that you can see problems
coming, even if the truth is difficult to accept.
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Scripture quotations are from The Holy Bible,
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