Budgeting is awesome and literally everyone should do it. As a creative guy with a Day Job, budgeting’s especially important for me since I need to track my Day Job hours and keep the accounts balanced while I finish my novel-in-progress. Not only that, it also shows me how I’m doing in my quest to pay off my student loans and helps me track how much of my income goes toward essentials (like rent!) and how much goes toward fun stuff (like books!).
I started budgeting WAY back when I had my first office job and was getting ready to move into my first non-Japanese apartment. At the time, I wasn’t sure how much I could afford in the way of rent and utilities (and back then I had no idea how much American internet cost), so I needed to see if living on my own was even an option.
Luckily as it turns out, it was—tracking my current, living-at-home expenses helped me see how much I had available for living-on-your-own expenses (minus the gas money I’d save by living closer to work!), and gave me a big burst of confidence when it came to moving out of my parents’ house.
A lot of my inspiration came from J. Money’s Budgets Are Sexy blog, which, aside from its cool name, has great advice for people looking to save money, cut their debt, and retire early. A lot of that didn’t apply to me as a younger twentysomething, but what did stand out was that budgeting helps you track your money, which gives you more confidence about your money, which gives you more confidence in general, which helps you do more awesome stuff, which is itself awesome (or sexy, as the name implies).
Since I’m a rogue who likes doing everything myself, I made my own budget spreadsheet in Excel to track income, expenses, and my Net Worth. The expanded Income areas suited me well (since even back then I was bringing in cash from different side jobs!) and the expanded Net Worth area helped me track my student loans, since a lot of them were divided up with different interest rates.
I also tend to live pretty frugally, with a minimum of excesses. If I’m spending a lot of money, say, going out with friends or on hobbies, I want to know where that money’s going so I can think about whether that lobster dinner or that stack of NES games from the flea market was really worth it. Credit and debit card statements track this for you, but I like to have all that stuff in one place so I can compare—and laying it all out in a budget makes it easy.
(Tracking your Net Worth is definitely the best part of budgeting, though, since it shows you how much money you’ve made every month. Even if your bank accounts don’t show much change, seeing the red numbers on your debt slowly drop can start the new month on a positive note!)
Keeping a budget especially helped me as a first-year grad student living off a $1,100 a month (!!!) assistantship stipend. Tracking expenses kept me from overspending, and seeing my income all lined up showed me how much I made from the side gigs I picked up editing and landscaping, and from cashback rewards on credit cards (which you should always use, because, man, they’re awesome, and probably deserve a blog post all their own fully explaining their awesomeness). Budgeting kept me afloat and confident while I made my way through grad school and finished my first novel, and saved me from having to take on extra debt like a lot of grad students do.
If you’re a creative person looking to gain control over your Day Job and transition into doing more of your own work, budgeting is hands down the best way to gauge how feasible that is, what kinds of sacrifices you’ll need to make, and how much outside, non-creative Day Job income you’ll need to stay afloat.
A lot of people I know worry about money even though they have kind of a lot of it because financial security is relative. People are scared that they’ll always need their current Day Jobs to make ends meet and are afraid to leave them. If doing creative work is your priority, then a good budget can outline the plan you need to get there, and show you that it’s more feasible than you think.
One way of getting there is by temporarily working a whole bunch of Day Job hours at once to save money you can use to work less later and thus focus more on your creative work. I tried this out last spring when I stumbled into a sweet work-from-home gig that was too good to pass up, so I worked sixty-five hour weeks between the new gig, my then-Day Job, and a big editing project I’d already scheduled. It was a rough two months where not a lot of writing got done, but when the smoke cleared I had a whole load of cash stashed away, and I knew exactly how long it would last me once the paid work slowed down and I could start writing again.
Most importantly, though, budgeting gives you the control and the confidence you need when it comes to making your financial and creative goals real enough to break away from your Day Job. That’s because nobody (and I mean nobody!) can focus on their own projects when they’re worried about bills.
If my budgeting spreadsheet doesn’t work for you, check out J. Money’s budget templates that inspired me once upon a time, or try making your own. Or, if just the thought of using Excel makes you cringe, try an app like Mint that simplifies things a bit.
Whatever path you take, though, make sure a good budget’s a part of your creative plan—trust me on this one ;)