LWL11.Create a Budget
CHECK-IN – Maximum time 20 minutes.
Mindfulness: Take a break from what you have been doing, breathe deeply, relax and recharge.
Step 1: Find a comfortable seated position with both feet grounded on the floor. Put a hand on your stomach. Close your eyes.
Step 2: Take a deep breath in through your nose and out through your mouth. Notice your thoughts and feelings and any tensions in your body.
Step 3: As you inhale and exhale, breathe deeply so your belly fills and empties with air. The hand on your stomach helps you practice belly – not chest breathing.
Step 4: For the next two minutes make breathing in and out your only focus. Let your thoughts come and go without trying to control them. If you find an area of tension in your body, relax it and let the tension go.
Step 5: At the end of the two minutes slowly open your eyes. Gently bring your presence back to your surroundings.
Gratitude: Taking time every day to be grateful can help our health, relationships, emotions and happiness. What is something you are grateful for this week? (Everyone in group shares.)
Review “How Are We Doing?” worksheet. (Led by loved one with behavioral health disorder.)
· Past week’s recovery activities.
· Goals for next week.
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SKILL FOR A LIFE WORTH LIVING – Maximum time 20 minutes
Discuss: How did you benefit from working on last week’s commitments? (Everyone in group shares.)
Think: What would it feel like to live within your means and achieve more financial stability?
Learning how to manage your money responsibly is important. But it can sometimes be hard to keep track of where your cash is going—and how much you actually have to cover your expenses. This is where making a budget can come in handy. A budget is a plan that details income and expenses to help support financial goals, money management and more. Creating a budget for your personal finances can help you reach your spending and saving goals. It takes dedication and consistency, but the peace of mind that a budget can bring—plus the potential improvement in your financial stability—can make it worth it.
Basic budgeting involves figuring out how much money you have coming in and where that money is going—and then choosing how best to manage that money.
Income: Income is easy enough to identify. For most people, it comes from their job. But other sources, like benefit payments or child support, might be included too.
Expenses: When it comes to expenses, there are a number of ways to classify them. You could look at needs versus wants. Things like housing and food might be classified as needs. On the other hand, vacations or eating out might be considered wants. Thinking about expenses as fixed and variable is also be helpful. Fixed expenses are your regular living expenses that recur with the same amount every month, like rent, utility bills, and car loan or mortgage payments. Variable expenses fluctuate more, like groceries, takeout and gas. If you use your debit or credit card to pay these costs, look at your statements to get an idea of the numbers.
The “Budget Tool” accompanying this session, will help you create a budget with pen and paper, you can also use a digital spreadsheet or on a budgeting app. Having income and expenses written out gives you a clearer picture of your finances. And if you’re saving for something specific, you can use your budget to help you determine how much you can realistically set aside toward that goal. Three most popular budgeting methods are 50-30-20, Zero-based, and the Envelope method.
50-30-20 budgeting sets aside 50% of income for needs, 30% for wants and 20% for savings, debt payments and investments. This can be a straightforward budgeting method for people who don’t want to have to create a detailed plan or account for every nickel.
Zero-based budgeting puts every dollar you take home toward a specific purpose. You may not always be able to anticipate how much you’ll be paying in expenses from month to month. But having a rough estimate of how much you’ll need to set aside can help you stay on track. To use this method of budgeting, pinpoint how much money you need for things like rent, bills, groceries and other necessities each month—as well as how much you want to set aside for any extras. Then decide how much money you want to put into savings. Finally, once any money comes in, split it up according to each of the categories and amounts you decided on. At the end of each month, your income minus expenses, savings and any other categories should equal zero.
Envelope method budgeting divide your income into categories, like bills and utilities, groceries and “fun” money, for example. Having an idea about income and expenses is especially important for this method because you determine how much money to allot to each category and put that amount in cash into physical envelopes. Or you can use a mobile budgeting app to organize your funds virtually instead of using actual envelopes. Once you have your cash divided up, the money in each envelope is meant to be spent on that category alone. And once money in an envelope is gone, you’re done spending. The idea is to stick to spending only what you have on hand. If you’re going the online route, the same idea applies.
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COMMIT & CELEBRATE
Commitments. This week I will:
· Complete the Spending Patterns Worksheet, write down what I spend each day this week.
· Work with others on my finances.
Benefits from keeping commitments:
· Understand why and what you spend money on.
· Sharing pleasant recreational activities helps keep us close and can become a buffer for negative interactions that can be part of any relationship.
Watch: Lyric video. (Video that reinforces this week’s topic.)