The ‘B’ Word
I am generally a detailed person and if there is an opportunity to make a spreadsheet, I am all in. You would think that knowing these two facts would make me a natural fit for accounting, finance, and budgeting. The sad truth is that I hate budgets almost as much as folding laundry. It’s true, there is a hamper of clean laundry next to my bed right now.
I could blame my parents or education for not instilling in me the importance of a budget and how to start one. But that would be me not taking ownership of my finances. There are a lot of philosophies about the best way to manage your money too which makes it all that more confusing.
Can you create a budget when it is the last thing you ever want to do with your time?
Taking Action to Create a PCS Budget
Our guest blogger inspired me to dig deeper into the ‘B’ word, especially how it ties into PCS season. I have been through PCS season and it is not easy. Looking back at our previous PCSs, I wish I would have considered the following:
Just Write It Off
Since 2017, only our active duty service members of the Armed Forces can write off PCS related expenses. It is great that certain moving-related expenses that are not covered by your employer can be written off for your PCS.
If this is news to you, here is the source for that information. The IRS provides Form 3903 to walk you through how you can write off moving related expenses that you incur, not that are covered for you.
I will caveat all of this by saying, I am not an accountant and you should absolutely talk with an accountant before claiming any deductions from your taxes - DiploDash® is not your accountant. This blog is not your professional tax advisor.
Make Your Money Harder to Access
One common tactic is to deliberately limit access to your own money. It’s brilliant but also frustrating because it is so fun to Make It RAIN! But the beautiful release of endorphins you get by spending that wad of cash is fleeting, just ask MC Hammer.
Here are some ways to limit access to your money or put some controls in place:
Multiple Bank Accounts
Savings, checking for bills, retirement, taxes, college fund, etc. Use different banks and set up automatic disbursements. It is pretty easy to set up automatic disbursements online these days.
Additional Income Tax Withholdings
I worked with someone who withheld a very large portion of his salary as additional federal withholdings because he knew if he could access it, he would spend it all. He used the big refund he would get back to plan a luxurious vacation every year and it worked!
Cash Only Spending
When you can only use what you have, and banks limit daily withdrawals you’re more connected to your spending. Plus all those ATM trips might be enough to curb your shopping habit.
Pre-Paid Credit/Debit Cards
Just like cash, this restricts what you have available to you. It's also an easy way to get kids accustomed to using a credit card that has limited repercussions. As they learn to use them for purchases it prevents them from shopping uncontrollably and going into debt.
Daily/Weekly Spending Audit
If limiting access is not for you, then collect all of your receipts each day and tally them up. Or login to each of your accounts, and check on the pending transactions for the day and add them up. Again, this is connecting you to your spending habits to bring you awareness. Just knowing how much you are spending can impact your habits.
The best time to plant a tree is 20 years ago, the second-best time is now.
- Chinese Proverb
Prioritize Your Spending
If nothing else seems doable, perhaps knowing what really matters to you can be your guide. Decide how you want to prioritize your spending and then set your limits. For example, if you know that you want to visit as many friends or family as you can, start by prioritizing a specific kind of rental car. Determine how much you can spend on a car rental, and go from there. Remember the priorities are just that, the few most important items to you.
Adding a ‘B’ to P-C-S isn’t about making it more difficult, it’s about setting you up to a smoother transition. You will see the reward(s) from your hard work soon and in the future.