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Yesterday was a powerful process for two reasons. First, it gave you insight into how much money you really need to fund your life. And second, you completed nearly 75% of what goes into creating a budget.
You wrote out all of your expenses.
The only thing left to do now is apply the above, below, or break even analysis so we need to do some simple arithmetic to help us figure that out.Analyze what your budget is showing you about how you living with respect to your means or money. Click To Tweet
For today’s lifework, which will be two steps:
Step 1: A simple subtraction problem.
- Your monthly take-home pay minus your MMN (get that number from Day 15).
For example, if your take-home pay is $2,349 every month and you calculated your MMN to be $2,100 then you will be left with an extra $239 at the end of every month.
On the other hand, if your take-home pay is $2,100 every month you calculated your MMN to be $2,349, then you will be left with a deficit of $239.00 at the end of every month.
Makes sense, right?
Do your simple subtraction problem here now.
Step 2: Apply the Above, Below, or At Analysis.
|If you have a deficit of money every month, then you are… (i.e. no savings and an increase in debt)||Living Above Your Means|
|If you have extra money every month then you are (i.e. money to save)||Living Below Your Means|
|If you have a deficit of money every month then you are… (i.e. no savings, but no debt)||Living At Your Means|
Using the chart below, analyze what your budget is showing you about how you living with respect to your means or money. (Above, Below, or At).
Hold on to these numbers because we are going to need them to deepen our goal setting work around savings and building your emergency fund.
Share your Day 16 numbers in The Happy Finances Community. What did you learn from your Above, Below, Break Even analysis?
That’s it for today’s lifework!
Also, leave a comment below with your “aha” moment or reach out to your accountability partner(s) for questions and insights.
Finally, hit me up and share your insights. I’m cheering you on.
The Happy Finances Challenge is 42 days of transforming how you “do” money and life. Get a copy of The Happy Finances Challenge book here today!
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