Prioritising Your Spending

Amyr Rocha Lima

4 min read

Have you ever wondered why your money seems to evaporate before your eyes, despite your best intentions?

As successful professionals approaching retirement, you’ve spent a lifetime mastering your career, but now, mastering your finances is the final frontier. Successful budgeting isn't a magic trick – it's a skill that you can develop with the right knowledge and tools.

The Conventional Budgeting Approach: A Tale of Discontent

Take Jane, for instance. A hardworking professional who earned a substantial salary, Jane found herself perplexed at how quickly her money disappeared each month. She tried to budget, slashing her small pleasures – her favourite weekly night out, her cherished magazine subscriptions, even her daily cafe latte. Yet, instead of feeling empowered, Jane felt disheartened and deprived.

Dissecting Successful Budgeting: What Does it Entail?

Let’s revisit the term 'successful budgeting'. A common misinterpretation of budgeting is that it means cutting back. That's not entirely correct. In essence, successful budgeting is about prioritising your spending, making your money work for you in a way that aligns with your values and the lifestyle you aspire to maintain.

So how do we prioritise spending? The answer lies in values-based budgeting. This process begins with identifying what's most important to you – and it isn’t the same for everyone. It could be health, family, security, travel, or hobbies. Once you understand your values, you can create a budget that supports those priorities.

And why prioritise? Simply because it encourages financial wellbeing. When you categorise your spending based on your values, it becomes satisfying to see your money flowing towards what truly matters to you.

Five Steps to Prioritise Your Spending

Assess your Current Spending: Before planning, it's crucial to know where your money is going. Track your expenses for a month or two.

Identify your Values: What are the things that genuinely make you happy and content? Your family? Travelling? Good health?

Categorise your Expenses: Based on your values, categorise your expenses into essential and discretionary spending.

Align Spending with Values: Once you've categorised your expenses, check if they align with your values. If not, it's time to readjust.

Review and Adjust Regularly: Values and priorities change, so revisit your budget regularly.

FAQ: Budget Help

Does Successful Budgeting Mean No Luxuries?

Absolutely not! As mentioned earlier, budgeting isn't about denying pleasures. If you enjoy a daily cup of quality coffee and can afford it without affecting your financial wellbeing, by all means, keep it. The keyword here is 'balance'. Successful budgeting allows you to indulge in luxuries in a manner that doesn't compromise your financial health or future goals.

How Often Should I Review My Budget?

Your budget is not set in stone. It's a dynamic tool that should adapt to changes in your income, expenses, and priorities. Therefore, it's a good idea to review your budget at least every three to six months. Regular reviews allow you to spot trends, understand your spending habits better, and adjust your budget to fit changes in your lifestyle or goals.

I’m Nearing Retirement, Is It Too Late to Start Budgeting?

It's never too late to start budgeting. In fact, as you approach retirement, it becomes even more important. Budgeting can help you understand how your spending will change once you retire, ensuring you have sufficient savings to maintain your lifestyle. If you're new to budgeting, don't worry! With the right approach and guidance, you can master the skill at any age.

Can Values-Based Budgeting Help with Long-term Financial Goals like Retirement?

Absolutely! Values-based budgeting doesn't just help with day-to-day expenses, it’s also a powerful tool for achieving long-term financial goals. By aligning your spending with your values, you’re more likely to stay committed to your financial plans, whether that’s building an emergency fund, paying off a mortgage, or saving for retirement. Remember, every financial decision you make today impacts your financial wellbeing tomorrow.

Rethinking Priorities: A Personal Journey

Remember Jane? She adopted values-based budgeting, prioritising her spending around the things she valued – her love for exotic food, her thirst for knowledge, and her morning coffee ritual. She didn't have to sacrifice her small pleasures, and still, her financial health improved. Why? Because she made conscious choices about where her money went, ensuring it aligned with her values and goals.

Over to You: Your Budgeting Priorities?

We’ve discussed the importance of successful budgeting, how to prioritise your spending, and we've seen it in action with Jane. Now it's your turn – what are your budgeting priorities?

Prioritising your spending and aligning it with your values can put you on the path to financial wellbeing. Remember, it’s not about denial; it's about making informed decisions that resonate with the life you want to lead.

For a more detailed discussion on this topic, please feel free to contact us. Our team are always available to answer your questions and to help you with any of your financial planning needs. Here’s what we offer: A cup of coffee… and a second opinion.

Client Stories

Mark & David Client Stories Chartered Financial Planner Strategic Wealth Partners
Mark & David Client Stories Chartered Financial Planner Strategic Wealth Partners

"The trust and feeling of comfort has grown over the eight years since our first meeting."

Steve & Liz Client Stories Chartered Financial Planner Strategic Wealth Partners
Steve & Liz Client Stories Chartered Financial Planner Strategic Wealth Partners

"They are good listeners and make thoughtful recommendations that are relevant to what we are trying to accomplish in our lives."

Anne Client Stories Chartered Financial Planner Strategic Wealth Partners
Anne Client Stories Chartered Financial Planner Strategic Wealth Partners

"Working with them on my long-term financial plan has been a source of comfort since my husband's passing."

Our job is to make sure that every decision you make moves you closer to your goals.

Are You Ready to Retire?

Take our retirement readiness quiz to learn whether you're on-track to plan for your ideal retirement.

Contact Us

If you've never worked with a financial planner before, we'll guide you through the process.

If you have previously worked with a financial planner but believe it is time for a change, we can assist you in making that transition.