Listen Money Matters - Free your inner financial badass. All the stuff you should know about personal finance.

Budgeting For A Lifestyle Change


Listen Later

You may have a budget but what if you have a big life change? Move cities, have a baby, buy a home. Budgeting for a lifestyle change can make or break you.

 You got the new job in a new place, your family grows, you need to care for a parent. Your old budget won’t do.

 A New Place

 What if your new job involves a big change of location? Moving from the suburbs to a city for example. Will you still need a car? Will there be a place to park your car? Maybe, but it might not be free and if it is free, you’ll likely be competing for lots of other people for the spot. Not many attached garages in the big city.

 What is the cost of living like compared to your current location? You might be getting a $20,000 jump in income but in the right (or wrong) city, that can be gone just paying deposits and broker fees. City-Data is a great resource to help compare the cost of living between cities.

The Best Laid Plans

Hopefully you’ve planned when to start your family but accidents happen. What if that happened to you? Would you be financially prepared? One of the biggest considerations before having a kid is day care costs. Prices fluctuate widely and sometimes the cost is so expensive, it actually makes more financial sense for one parent to stay home.

A family situation that is harder to predict is that of your parents. None of us want to think about our parents aging and getting ill but it happens and you might have to step in. How much money do they have set aside? Would they want to live with you, stay in their own home, move to an assisted living facility? Who will make medical decisions if they cannot? Have these discussion with your parents before any of this happens.

Buying A Home

You found a $100,000 home and you have $20,000 to put down, great 20%! No, not great to the bank. They don’t want you to be cleaned out making the down payment. You won’t be able to pay the mortgage or the taxes. You might want to do some renovations so you can put your own stamp on the place. You moved from a studio to a house. Your futon and bean bag chair will look pretty lonely in a 2,000 square foot place. Twenty percent is not enough.

Start A Business

You have a killer idea and you long to quit slaving away for the man and want to start your own thing. Great! How much run way money do you have? What are the start up costs? Is your spouse on board or will they freak out if there isn’t a regular pay check coming in? How will you pay for insurance now that you no longer have it through your employer?

Get A Baseline

Where is your money going now? Before you make any big changes or decisions, you need to know this. If you had to cut to make room for something else, what could you sacrifice? Some things become such an ingrained habit, that you don’t notice anymore just how expensive they are (booze). Not everything has to be completely axed, some things could just be reduced (booze).

Think back to your past. There was probably, hopefully, a time, when you spent less money than you do now but were still happy. Now think how much more you’re spending currently. Does the level of happiness correlate to the greater amount of money you’re spending? Probably not.

It certainly costs more to be an adult than it does to be a college student but if your costs have sky rocketed, it’s unlikely that all of that money is going to fixed costs. A lot of it may be going to lifestyle upgrades, a bigger place, better car, nice clothes. The longer you can live like a student while earning like an adult, the further ahead you will be for the rest of your life. 

How Much Do You Cut?

Let’s say you make $50,000. Use a base of 60%, so $30,000 after taxes and savings. Divide the $30,000 by twelve months to get $2,500.

Learn more about your ad choices. Visit megaphone.fm/adchoices

...more
View all episodesView all episodes
Download on the App Store

Listen Money Matters - Free your inner financial badass. All the stuff you should know about personal finance.By ListenMoneyMatters.com | Andrew Fiebert and Matt Giovanisci

  • 4.4
  • 4.4
  • 4.4
  • 4.4
  • 4.4

4.4

2,236 ratings


More shows like Listen Money Matters - Free your inner financial badass. All the stuff you should know about personal finance.

View all
The Stacking Benjamins Show by StackingBenjamins.com | Cumulus Podcast Network

The Stacking Benjamins Show

1,957 Listeners

Retirement Answer Man by Roger Whitney, CFP®, CIMA®, RMA, CPWA®

Retirement Answer Man

1,293 Listeners

Retirement Starts Today by Benjamin Brandt CFP®, RICP®

Retirement Starts Today

491 Listeners

Afford Anything by Paula Pant | Cumulus Podcast Network

Afford Anything

3,522 Listeners

ChooseFI by ChooseFI

ChooseFI

5,071 Listeners

NerdWallet's Smart Money Podcast by NerdWallet Personal Finance

NerdWallet's Smart Money Podcast

719 Listeners

Stay Wealthy Retirement Podcast by Taylor Schulte, CFP®

Stay Wealthy Retirement Podcast

549 Listeners

BiggerPockets Money Podcast by BiggerPockets

BiggerPockets Money Podcast

3,069 Listeners

How to Money by iHeartPodcasts

How to Money

3,170 Listeners

Ready For Retirement by James Conole, CFP®

Ready For Retirement

767 Listeners

The Personal Finance Podcast by Andrew Giancola

The Personal Finance Podcast

1,334 Listeners

Early Retirement - Financial Freedom (Investing, Tax Planning, Retirement Strategy, Personal Finance) by Ari Taublieb, CFP®, MBA

Early Retirement - Financial Freedom (Investing, Tax Planning, Retirement Strategy, Personal Finance)

33 Listeners

All the Hacks with Chris Hutchins by Chris Hutchins

All the Hacks with Chris Hutchins

1,421 Listeners

Retirement Planning Education, with Andy Panko by Andy Panko

Retirement Planning Education, with Andy Panko

696 Listeners

Catching Up to FI by Bill Yount & Jackie Cummings Koski

Catching Up to FI

303 Listeners