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How to create a budget for relocation and not self sabotage yourself during the process!

Updated: Nov 16, 2020

You've decided to relocate! That's GREAT I am so happy and proud of you because that takes guts. So many unknown variables, so many ways you can fail so many things that can go wrong. I have experienced my fair share of disaster. It takes many failures before you find that winning formula. Once you get it, then you got it, so it's good! Today if you'll let me, I would like to share how to create a budget for your relocation and some tips to help you succeed.


One of the significant challenges with saving is how do you keep up with your regular bills and save money at the same time? During this last relocation to New York City (I've relocated here several times), I was also running a business, so I was balancing budgets all over the place. I knew I had to develop a strategy to streamline my savings process while staying on track.

There are four figures you need to know to create your relocation budget. Two of them you should already be familiar with, but if not, that's okay. We can do that together.


How do you keep up with your regular bills and save money at the same time?



How do you keep up with your regular bills and save money at the same time?

1. What are your monthly expenses right now?

2. What is your monthly income?

3. How much will it cost you to relocate?

4. How much will you need to live once you move to a new place for at least 3 -6 months without a job?



I spent a week writing down everything I spent money on to ensure that I had a handle on my monthly expenses. I encourage you guys to try this because you will be amazed at how much money you spend. Documenting what you pay is probably just as important as being consistent with your savings because if you aren't cognizant of how much you are spending, you won't ever be able to save. For me, I realized I was overspending on booze and sushi dinners, so I needed to reign that on in.





The next step was figuring out how much my relocation would cost me, which is where 3rd & 4th figures from my list came into play. Adding those two numbers together is how much money you will need to save for your relocation. When I added numbers 3 & 4 together, I needed to save $8,600.00, which I rounded up to $10,000. If I wanted to save 10K in one year, I would need to save $833.00 month.

Relocating in one year: $10,000 / 12 = $833.00

Relocating in six months: $10,000/ 6 = $1,666.00

Now that you know how much you need to save, here comes the fun part. Just kidding. This part is not that fun, but you can make it fun! The path to saving divides into two roads, decreasing your expenses or increasing your income. How do you know which route will work best for you? Take into consideration a few factors- Would your life blow up if you got a second job? Or if you gave up your apartment and moved home or got a roommate to split expenses.

Would your life blow up if you got a second job?


Raising your Income


Considering getting a second job? This method allows you to do more of a trimming of your expenses instead of major cuts. However now you will have less time for everything so if you have children or are in a committed relationship, everything including personal time for yourself will have to be set on a strict schedule. When considering what kind of second job, you want to ask yourself questions like, what jobs are out there that can pair well with the hours of your day job? How much money do you actually need to reach your monthly savings goal?

Raising your Income

Considering getting a second job? This method allows you to do more trimming of your expenses instead of significant cuts. However, now you will have less time for everything, so if you have children or are in a committed relationship, everything, including personal time for yourself, will have to be set on a strict schedule. When you consider increasing your income, you want to ask yourself questions like, what jobs are out there that can pair well with your day job hours? How much money do you need to reach your monthly savings goal?

Lowering your Expenses

In my situation, running a business was my "second job," so the only option for me was to lower my expenses. I referred back to my list of monthly costs and started with the largest expense-Rent. I did not have to move back home because I had someone I was splitting all the household expenses, which helped my savings process tremendously. Would getting a roommate be the best solution for you? Do you live in a one-bedroom that you can convert your living room into a second bedroom? Or is going home or moving in with friends the best option for lowering your rent expense? I had to consider that some of my monthly expenses were at a fixed price, and there was little I could do to reduce them, like my cell phone bill and my utility bills. Unplugging my electronics and turning off my surge protectors every day before I left for work helped a bit but not enough, so I begin chipping away at my grocery bill.


A great way to lower that expense was embracing the generic form of life and buying

off-brand. Shopping at cost-saving grocery stores like Aldi or Sav A Lot became my greatest ally. Meal planning was the cherry on my ice cream Sundae of savings; meal planning is a great way to save money and time. I will admit it was difficult some days to watch my co-workers all go out and return with food, laughing, bonding, and having a great time. I had to remain diligent and sit at my desk with my lunch from home. I also bought my toiletries in bulk. The key to being successful with living on a budget is discipline and watching every dollar you spend like a hawk.




Next on my list were the expenses that I could control, like my miscellaneous expenses. I got rid of all my paid apps, except for the ones I used for my business.



My bi-weekly Mani/Pedis became once a month splurge, and I learned to love playing hairdresser.





Want more budget-saving tips? Click the video below for even more tips and tricks on preventing self-sabotage of your savings journey. I would love to hear more from you all about where you are on the path to relocation. What's your take on lowering expenses vs. raising your income?


 



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