How Loud Budgeting Can Help You Achieve Your Financial Goals
Are you ready to make this year the one where you conquer your financial goals? Whether paying off debt, saving for a big purchase, or planning a major life event, ‘loud budgeting’-a unique approach to managing your finances that involves open communication with your loved ones about your spending habits-could be the key to making it happen. Let’s explore how.
What is loud budgeting?
Loud budgeting, a trend that originated on TikTok, was popularized by writer and comedian Lukas Battles. It’s a unique approach to managing your finances that empowers you to communicate openly with your loved ones about your spending habits. This honesty can accelerate your journey towards financial freedom.
Let me share a personal story. When my husband and I were going through IVF treatments with the hopes of conceiving, we had a financial goal in mind: I wanted to be able to stay home with the baby. We had $18,000.00 in credit card debt and a car loan. But through the power of budgeting, we paid off the debt in just one year.
Our close family and friends knew about our situation, so they understood that eating out or happy hour was not our priority. This is the essence of loud budgeting: open communication and understanding.
How to loud budget
- Make a financial plan
You should make a financial plan that includes your goals and a timeline to reach the goals. For example, you want to pay off $5,000.00 in debt in one year. So, divide that into twelve months, and you will need to pay around $420.00 each month for one year instead of making the minimum payment. Where can you cut spending? Eating out, shopping, or going out for dinner and drinks with family or friends.
Having a financial plan lets you see the big picture, making it easier to reach your financial goals. Remember, a ‘financial plan’ is simply a roadmap for your money. It helps you know where your money is going and how to make it work.
- Let your family and friends know
This one might be a little difficult, especially if it is hard to tell people no. But when your family or friends invite you out for dinner, just be honest and tell them about your financial goals. All you can say is thank you for the invite, but you know I want to pay off some of my debt this year, so I am trying not to spend as much to pay off debt faster.
You are not telling them no; you are just reaching your financial goals now. They will understand. Remember, loud budgeting is about open communication and understanding, not deprivation or isolation.
- Offer free options or events
There are many ways to get together with family or friends that do not involve spending much money. Instead of meeting for breakfast, offer to make a quick, easy breakfast at home. If the weather permits, go to a park and have a picnic. You can be a tourist in your town or nearby towns to explore. Everyone can bring a snack and do a game night instead of going out for dinner and drinks.
- Clear Boundaries
Clear boundaries are also beneficial when loud budgeting. With loud budgeting, you prioritize what you will and won’t spend money on while trying to achieve a financial goal. For example, make it clear that for a few months, you will not be spending any money on clothes, shoes, or anything related to fashion. But you will spend money on coffee or one dinner a week.
Setting clear boundaries with your family and friends will make it easier for them to ask you to get together. Since they know you are not spending money on fashion, they will not ask you to go to the mall or retail stores.
- Be comfortable saying “no”
Saying “no” to family and friends can be challenging, especially if you are a people pleaser. I usually do not make plans or say yes to something until a few days or even a day before. I do not like to have a busy schedule, so I wait to see what my priority is and if I have the money to do what I get invited to do. Saying no right now will help you reach your financial goals faster.
- Get an accountability partner
This is a great way to keep yourself on track to your financial goals. An accountability partner can be your spouse, close friend, or family member. It can even be someone with some financial goals, and you both hold each other accountable.
You can do monthly check-ins to see how you did in the past month and plan for the following month. If you feel like spending money, you can call or text each other to remind you of your goals and keep you on track.
- Create a budget
Many people do not like the word budget and think it is about depriving yourself. A budget is not that, but rather, you are telling your money where it will go. You can choose where your money is going and prioritize your financial goals. It also helps you see the bigger picture of where your money is going.
- Challenge yourself
Creating challenges can make you reach goals faster and keep you motivated. You can challenge yourself to say no when you need to pass on something. Challenge yourself to reach a financial goal faster than you have planned. Making small or big challenges that work for you can help make your goals much more effortless.
You can read my 13 Easy Tips for a low-buy no-buy challenge.
How loud budgeting is beneficial
- Reach financial goals faster: When you loud budget and have financial goal, it can help you make better spending habits and make it easier to say no.
- Better relationships: Honest and open communication with loved ones can help strengthen relationships.
- Breaks bad habits: Sometimes, we have bad spending habits, like buying or doing things for instant gratification. Loud budgeting for a few months can help break bad spending habits.
- Prioritize what truly matters: Instead of spending and saying yes to events or things that don’t bring value, you will prioritize what truly matters. This can help you make time for self-care or hobbies.
Final thoughts
I know loud budgeting is a great way to reach any financial goal. Many people do not talk about their finances, but there may be some things that should be okay to share. Sharing your finances and your goals can help someone improve their finances. They can get ideas of how to invest, how much you should be making, or how to budget.
It can be eye-opening for some to learn about finances and know that it is possible to reach financial goals by prioritizing money goals. So, don’t be afraid to start loud budgeting and see the positive changes it can bring to your life.
Comment below and let me know if you have any financial goals this year and if you will loud budget to reach them.
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