BIRD WILLIAMS: You're listening to Bird Means Business Episode 11. 

Hi there! Today we are getting personal on the podcast. Yep, we're talking about personal budgeting. You might be thinking, “Wait, this is a business podcast, right?” Yeah, that's right. And let me tell you something. Y'all know y'all gotta have your personal finances in check first. If not, you can suck the life right out of your business, by having a lack of stability at home. So we're going to make sure that we got your personal finances in check. And I'm going to share from the perspective of having a spouse because I get a lot of questions about, “I'm going into business with my significant other, and we have all these questions about how to kind of manage things.” So I'm going to share from that perspective. And it also just kind of feels right and coming off of that really fun interview with my husband, Terry Williams, which is Episode 10. If you haven't checked it out, you want to just go ahead and do that because there is so much gold in that episode. 

So in this episode, you're going to learn about when you should start budgeting, spoiler alert, right now, why you shouldn't ignore budgeting, how to help minimize discretional expenses, and then joint accounts versus personal accounts. It's this really cool fair system, between you and your spouse, but it also promotes freedom, which we need in marriage, right? 

So, for those of you who don't know I own a warehouse gym here in Houston, Texas called The League. We have our own proprietary training format called PAC(K) training, and we love what we get to do, inspiring folks inside and outside of the gym. So my husband, Terry and I have run The League since 2013. But let's back up to when Terry and I first got married. Y'all, we didn't really budget. I had just moved back from New York, and although I made six figures there, I was not very disciplined with my spending, and I was in my early 20s, and New York City isn't cheap. My rent y'all, it was like a 400 square foot apartment and it was $2,287, a month. Ooh, Lord Jesus. I remember those times it was crazy. And Terry also made great money but again we were like young and we just didn't know we didn't know and we weren't very disciplined when it came to budgeting. So when we got married, we were in this like weird season of transition. I was working part time for startup companies in Houston and Austin as we were preparing to launch The League. And Terry was kind of winding down his training practice at gyms around the city so that he could be all in, I believe, once it launched. And I remember thinking and I remember having conversations like, “We don't really have anything extra at the end of the month, like what's the point of budgeting?” I didn't really have like steady income. Terry was winding down, so it was like, what is the point? And y’all this is embarrassing to admit, but it took us four years and a whole pregnancy, to really get serious about tracking our expenses. And guess what we discovered. We were spending about $900, per month, eating out. What? Like, where they do that at? No. What are we eating? That was my question. And y’all we were completely unaware. And I can already kind of feel you judging me, so I'm just gonna say what you're thinking. How ridiculous, right. Yes it was out of control. But because we weren't budgeting, we just didn't know where our money was going. So this is why it is never too early to start budgeting, even if you feel like you don't have anything to budget, just start now. Start tracking your expenses. Start getting an idea of where your money is coming in, and where it's going out. 

So today we're going to talk about how we incorporated monthly budget meetings into our marriage. It helps save us tons of money. But before we get started, I want to share a listener shout out martinez_girl03 left a review on Apple podcast saying, “As a new business owner myself, Ashley breaks down business and entrepreneur topics to fuel your mindset and journey. You can feel how passionate she is as she shares her wisdom. And I love that she gives you actionable items to take away. Highly recommend BMB”, which is Bird Means Business. Thank you Martinez Girl! I appreciate that review. Thank you so much. It really means a lot to me knowing that this is helpful to you. Like I say all the time, at the end of the day, I want to help and serve my listeners. I want to share all the experience and lessons that I’ve learned on my journey so that it can just help you on yours. That's really why I'm doing all of this. So thank you for leaving that great review. 

So although we didn't start off budgeting, these days we sit down each month and we review the previous month's budget. So, we're going to look at our income streams. And then also our fixed and variable expenses in categories, and then analyze the bottom line. And we ask questions like, were we over or under budget? What expense categories have we been trending over or under? Are there any new goals or things in the pipeline that might cause us to adjust our budgeted projections? And then we're going to go in and adjust the future budgeted numbers based on those trends. So for example, let's say we've been budgeting $30 a month for dry cleaning, but we've been going over consistently the last few months because we're now on video a whole lot more. So, this is going to tell us we need to increase the amount that we need to budget for dry cleaning. 

So the idea is that you want to plan to bring in more than you spend, and you want to hold yourselves accountable for staying within reason. So you're able to kind of say okay this is what makes sense for us. When we look at our income and we look at all these different expense categories, we need to see in the future that there's something on the bottom line. There's money there, or at least zero, but it's not negative. And if it is, that means you know you need to make adjustments. 

So our monthly budget meeting holds us accountable and helps us stay on track. For example, if you shop differently knowing that you're gonna have to talk about it with your spouse, next month. And we also don't have issues with like low balances in our bank accounts or like auto pay memberships that we're not really using, or even like accidental duplicate charges on a credit card, for example, because we're tracking things month over month. It is so important to do this on a regular basis. 

So disclaimer. I'm about to share some of our budgeting strategies, but it will not work for everyone. This is just what's working for us right now. So maybe it will spark dialogue between you and your spouse or maybe serve as a template for something better that fits your situation. I want to even give an example for about how it's okay if everything I share doesn't resonate with you. I took Dave Ramsey's Financial Peace seminar, and I loved it. I also didn't think that all the principles worked for our family. For instance, he follows a cash system. But our family uses a credit card, and we pay it off in full each month. This has allowed us to fund several vacations, using only credit card points. Boom chakalaka, I love it. But if we didn't have the discipline to pay off the card, every month in full, then carrying the debt would not be worth the points paid vaycay, right? So, it has to make sure that it works for you. You can take the parts of our strategy that I'm about to explain that work for you and leave the parts that don't. 

All right. So how did we get that $900 per month, eating budget down to $300 a month? Okay, y'all. This was huge for us. So, herein lies your freedom in marriage when it comes to money - personal accounts. Oh yeah. When we looked into it, most of that $900 was individual eating out. So we decided going forward, all of the individual eating out will come from that individual's personal account, and we will only jointly pay for family eating out. So we didn't have personal accounts at the time. At this time, everything was kind of coming into one account and going out of the same account. So we just easily set up personal accounts with our bank, and this is what our money process and how our personal accounts look now. So this is how it goes. All of our income is automatically deposited into one account. Let's call this our joint account. This is the main account, out of which our family lives. So all of our joint expenses are paid from our joint account. We break it up into fixed expenses, which is like our mortgage or internet and utilities, etc. which are about the same every month. 

Then we're going to have also our variable expenses. So these are going to change month to month like eating out, groceries, health care, etc. So this is the fun part, or at least for me. Each month we allocate a certain amount to go from our joint account to our personal accounts. So let's say, for example, it's $100 a month. At the beginning of every month, $100 will go from the joint account to Ashley's personal account, and $100 will go from the joint account to Terry's personal account. Now some couples will choose to split up the personal allowance by percentages instead based on the spousal income. But I personally don't love this because it can make the lower income earner feels slighted if they contribute to the household in a way that doesn't maybe provide a direct income stream, but may cut expenses like a stay at home mom. So the goal of this whole system is really to empower each spouse so just do what works best for you but we keep it even. It's the same amounts going to Terry's account that's going to my account. So the beauty of the personal account is that you have the freedom to do whatever you want with that money. If you want to spend it all every month, that's cool. If you want to save it up and spin it on a $400 pair of shoes in four months, hey that's cool too. There is freedom here. It is really, really beautiful. And the cool thing is you don't have to feel bad about how you spend your money because you and your spouse have agreed to this system, and you're not arguing about personal purchases that your spouse made because you've created space, and boundaries around this. So the two of you get to decide on what are personal expenses and joint expenses and that can be another conversation for another day. I joke because like some things, for example, like for me with cable. It's like I don't really watch TV, so I don't even really think that we need to have cable. But Terry does. He likes to watch football or sports and whatever, and it's fine. It's a joint expense but you can just kind of decide what constitutes personal versus joint. 

I love this system though because a friend of mine actually told me about it. Her husband was like fussing at her for buying a very expensive designer bag. And they had this whole argument about it and then a couple weeks later he literally bought a car. And she's like, “You were mad at me for buying a bag and you bought this really expensive car.” And so that's when they came up with this whole personal account system and I just love it. 

So, what about saving. So I knew you would ask about that and we do agree on an amount to save from our joint each month as a fixed expense. And it's automatically transferred to our online savings account, hey, higher interest rates, each month. So again, there's no guilt in your personal account for what you're spending because you're already jointly saving. And also automating savings is the jam y'all. You're saving without even having to think about it. I mentioned that online savings account. There are a lot out there. We use Ally, and it's great because the interest rates are a lot higher because it's just online, so they're not having to pay for the overhead, that's associated with a brick and mortar. And so they're able to kind of give you more in interest rates so we put all of our savings there. 

Another perk of the personal account system is that you get more disciplined. In relationships, in most of them, there's a natural spender and a natural saver. So when the spender has to pay for their every morning Starbucks or that fancy hair appointment themselves from their personal account, things tighten up real quick. So yeah, it can feel like a lot to work through but it's actually really simple, and it's so empowering knowing that you're building a strong foundation with your spouse. But y'all, be gentle with yourselves. It is a process, and you will not get it right the first few times. It honestly took us a while to really get even comfortable talking about money and really working together on this. But remember you're on the same team, and you're doing the best with what you have. 

So over the years friends have asked for our budget template and so I thought I'd share it with you. You can go to the link in the show notes, the episode description, wherever you're listening to this podcast, or also find it in the link on my Instagram bio. Or if you're on my website listening to the podcast is there as well. And you can just download this and modify it for your family. 

There are tons of free budgeting apps out there, which could also work. The point is that you're figuring out what works best for you. I will say this is a personal budget template. On the business side of things, I include budgeting resources like this for those clients who work with me one on one, depending on their needs. So to that point on the business side of things we do something similar. Each month. Our accountant Alby, who you may have heard me talk about and if not check out episode 2, which is securing your money team, because I really share how he helped us in so many ways. Anyway, he sends us the previous month’s profit and loss statement and the updated balance sheet. And then we review these numbers to ensure that things look right. And then we plug them into a similar document that we keep internally, which tracks our business financials. So in the same way we want to make sure that we're staying in line and kind of adapting as we need to make changes to things so that we're just not surprised down the road. 

The point is, is that you just want to make sure you know what's going home with your money. Your money is not the thing that you want to just ignore and hope it all works out. You need to really be able to answer questions around money in your personal finances, and in your business finances. And it's so important that you have a strong foundation personally when you're going into business, because again, if not, you will need to take from your business when maybe you should be reinvesting back into the business. You want to of course take some, but you don't want it to be like, “Man, I need thousands of dollars for this thing because I'm simply not budgeting personally.” You want to be able to really have a hold on things before you can really move into your business strong. 

All righty, that's about it for today. So thank you so much for following on Spotify, for subscribing on Apple Podcasts, and for telling your entrepreneur friends about Bird Means Business. Talk to you next week.