Aug 286 min read

What Are the Key Elements of Budgeting?

by Riley Cook, Finance Editor

“Largest and easiest expenses to cut for corporations is people.” – Randy Howard.

According to Crunchbase News, as of August 27, 2024, more than 90,000 Americans have lost their jobs since the beginning of the year. Companies such as GoPuff reduced their workforce by 6% on May 17, 2024, and Peloton laid off 15% of their staff earlier this year to align spending with revenue. During the pandemic, companies like Peloton saw immense growth in sales, and for some time, many corporations believed that there would be a transition from regular gyms to home gyms following this massive upward trend.

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However, suggesting that people stay inside for an extended period of time did not make them eager to keep up this at-home workout movement once the mandates were lifted. But Peloton seemed to have missed the mark and a great opportunity to pivot because while many husbands and/or boyfriends were eager to head back into the office and the gym, women, on the other hand, wanted to stay home. Women found that staying home to raise their children or work out was better for their mental health.

Additionally, for many women, going to the gym is an unpleasant experience when they are being hassled by men or given unsolicited advice pertaining to their workout. Not only that, one woman took to her social media platform to vent her frustrations when she was badgered while using a machine since she was taking breaks in between her sets.

A male member took that time to scold her for taking too long on the machine when he wanted to use it next. Experiences like this, along with the aforementioned reasons, are just some of the reasons why women prefer to be at home. With so many people out of the workforce or choosing to work for themselves, running errands on weekdays midday seems almost impossible.

So, what happens now? With so many people worried about their finances, there’s an uptick in side hustles and gigs such as Uber and DoorDash, but of course, with demand comes a rise in pricing. Gig work is nothing like it used to be, considering many drivers are also complaining about the lack of tips they receive for physically demanding or long-distance orders.

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Where do we meet, and is there a solution? First things first: budgeting, which happens to be a crucial aspect of financial management that helps individuals and organizations plan their finances effectively. Consider changing your gym membership from $40/month to $20/month. Downsizing is nothing to be ashamed of because there is always room to grow once things start to improve. Identifying all sources of income, including salaries, side jobs, and investments, is where you begin your preparation.

Next, you need to list all of your fixed expenses, such as rent or mortgage payments, insurance, and loan repayments, which remain consistent each month. For many Americans, it’s a goal to own a home, but the reality is you’ll never actually own the home. There are property taxes that will remain a constant, plus fixtures and home maintenance that you will need to budget for. One thing to consider is joining a program that allows you to pool your money with others for a payout sometime during the year.

This is popular among smaller countries and helps them save money by pooling with a community for a payout. The more people who join, the larger the pool, the greater the payout. In this case, programs like the HomeHope Fund are available from us here at She’s SINGLE. A winner is announced every three months, and the pool is sent to them, minus the amount that will be re-added to the pool for another person to win three months later. So far, we’ve had three winners from various parts of the country win more than $25,000 in earnings. This money can be used for the down payment on a home, paying back rent, or even catching up on bills.

Homeownership in America is not the best option if you’re seeking a single-family home. You should aim for a multi-family unit where you can rent out additional spaces to help pay the mortgage and make a profit. If you’re thinking about equity and having the ability to refinance your home, then a safer option is whole life insurance while renting a home. This means you can save money in the long run because you’re not paying for any fixtures, while simultaneously building your whole life insurance policy to have access to its cash value if you ever need it.

This is similar to refinancing a home minus the hike in interest rates and mortgage payments. If you need to take money from your life insurance policy, you can be sure that the monthly payment will not be affected. Your savings goals have to be realistic when it comes to budgeting, and maybe it’s not feasible to purchase that $25,000 car right now, but you can save for it—allocate funds toward your goals and something like the HomeHope Fund, where you’re guaranteed to receive a payout at some point.

This is not you blowing money into the wind and never seeing it again—much like playing the lotto—this is a guaranteed return on your investment. The people in the community pool are always seeing a return. Taking part in opportunities like this can help to fast-track you to the next step, which is monitoring and adjusting. Once you have a grip on your finances, you can begin to create a line-by-line spreadsheet to track your expenses and income.

It’s easy, which is a good thing, and will always place you in a position of knowing what your spending habits should consist of. Plus, this type of monitoring helps you to avoid overspending and overdraft fees that are unnecessary debt. Take accountability because while this process—in the beginning—will feel like there is no light at the end of the tunnel, there is. But in order to not make the same mistakes twice, it’s up to you to hold your hand and guide yourself toward financial freedom.

Have an emergency fund as well, which is also something many contributors have used the HomeHope Fund for. Because the winners are randomly selected, many of its contributors put money in, forget about it, and wait until their name is drawn; next thing you know, they’ve invested $150 and may just win $20,000+ in as little as 6 months.

What Are the Key Elements of Budgeting?

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