Financial health isn’t just a theoretical big picture thing involving spreadsheets, a budget and savings.  The fact is that when you run short of funds for a night out with your friends, a trip home to see your family, or your half of the cost of a date night, it’s tempting to blow the budget and dig into dollars reserved for bills, food, laundry or the new tires you know you need.  Before you use the credit card and kick the problem down the road, figure out how you got here:

Spending too much or earning too little and giving in to impulse are the usual culprits in the not-enough-money scenario.  We start out with the best of intentions, and then whittle away at the cash supply with a random Starbuck’s here and a trip to O’Maddy’s there.  If all your friends are going, if you are there when the pizza is ordered and the group agrees to spit the bill, its more than fear of missing out: you don’t have a strategy for the times when you really can’t afford it.

What does a strategy look like?

  1. Start with identifying, preferably writing down, what’s important to you.

You have to start with affirming what you really want.  I once worked for an executive who by all accounts, including her own, managed her money to the penny.  If the server gave you one check for the table and she was at the table, out came her math skills.  To the penny.  Her philosophy—stated often—was that she only wanted to spend her money on things she really wanted.  She planned for expenses, and having shopped for clothes with her, I can attest that when she was ready to spend, she did.  But she was never impulsive or wasteful.

  1. Acknowledge and speak your money and spending truth to your circle of friends.

Then look around and find the people you know will understand and who will not try to undermine your plans.  Your posse should be willing to flex and help you—not by paying your share (that is a form of undermining and obligating you, isn’t it?) but by making plans to spend time with you, not money.  My friend Janice lost her job and confessed, when I asked her to lunch, that she couldn’t afford it.  So, we filled up water bottles and laced up sneakers, and went for a long walk together.

  1. Identify cheaper alternatives and make new habits.

You can get creative and attract creative friends, with a little effort.  A few years ago a group of friends started a once a week dinner club, taking turns being the host.  Everyone brought one dish, and they shared leftovers for a few more meals, bringing containers to take home.  Vegetables and pasta or rice are not particularly spendy, add a protein and you can get very fancy on a budget.

  1. Set a budget.

Just so you know, some people love to do this.  You at least need to know how much money you have, so that you always know how much you need to live on.  It’s a lot like keeping score.  It can be highly detailed, with lots of line items, or it can be fairly simple and act as a record of your cash flow.  Either way, you will quickly start to see where your bank thinks your priorities lie and decide if you want to make some adjustments.  This is when you begin to realize you aren’t rich just yet.

Last, and this is difficult when your posse wants an outing that you know you can’t afford:  Stick. To. Your. Plan.  Remind yourself of what you really want, and postpone—postponing is different from giving up altogether—your spending.

Author: Catherine B. Martin