Does thinking about your finances stress you out? You’re not alone; 60-80% of young adults admit that thinking about money makes them feel stressed. That stress often leads to completely ignoring your finances. You know you make money, you know you spend money, you might know how much comes in, but you definitely don’t know how much goes out. Budgeting is completely out of the question because that would mean coming face-to-face with your spending habits, and that’s way too scary to deal with. So, you go through life feeling like you never get ahead, and how could you get ahead if you don’t know where you are now?

How do you get over the financial scaries?

You’re going to have to come face-to-face with your spending habits. Nerve-wracking, I know, but let’s be clear, this is not an exercise in berating yourself for how much money you spend. This is a fact-finding mission. You’re educating yourself on your finances so that you can be a knowledgeable, responsible, well-rounded adult. Start small so you don’t overwhelm yourself with information and give up before you get going.

First, go to your banking app and find the exact amount that was on your last paycheck. You can also log in to the platform that your job uses to issue paychecks and look at your last paystub. Assuming you get paid bi-weekly, your monthly income after tax = $ amount on your paycheck x 2. Put that number on a spreadsheet. Now take a break.

Tomorrow, you’re going to find an expense that costs you the same amount of money every month, like rent, and add that to your spreadsheet. Hardly any research or math goes into this since the amount doesn’t change. Easy-peasy. Take another break.

You have some other monthly expenses that have roughly the same amount on each bill – utilities – use the next day to add these to your spreadsheet too. You’re well on your way to making a budget sheet.

Each week, add two more expenses to your spreadsheet. Maybe next week you add groceries and gas. The following week, add subscriptions and eating out. Keep adding two expenses a week until you have a full picture of what your money is doing. If you have any side gigs, write down the income from those as well. Make a new page on your spreadsheet every month to update your income and expenses, et voila – you have a monthly budget sheet.

Now what?

Now that you know what comes in and what goes out, it’s time to turn that knowledge into action. This is where the actual budgeting comes in. Subtract your total expenses from your total income for the month to see if there’s any money left over. If there is – congratulations, everything you currently spend money on fits in your budget. If there isn’t – take a look at your expenses, where can you afford to cut back a little and save some money? For most of us, that answer is easy: we need to stop ordering takeout all the time and curb our Starbucks habit. The good news: in theory, this is a really easy way to save money. The bad news: in practice, it’s harder than it seems. But I have faith that you’ll rise to the challenge.

Again, start small. Don’t set yourself up for failure by biting off more than you can chew. If you get Starbucks every day on your way to work, next month, try cutting back to two days a week. Every little penny honestly does count.

This is the start of your path to financial freedom. I’m not just talking about the freedom to buy whatever you want without thinking about it. I’m talking about the freedom of not being afraid of your finances, knowing what is and isn’t in your budget, and comfortably living within your means without worry. Sounds nice, right?