Life is all about finding balance. Balancing sleep with wanting to stay up all night watching the latest binge-worthy show, eating a salad for dinner while also indulging in a chocolate chip cookie or three, and wanting to go above and beyond at work while also wanting to have boundaries. Being an adult in today’s world is a juggling act for sure, and never more so than when it comes to finances.
It feels like there’s so much conflicting information about how to manage our money. “Go live your best life, you’re only young once!” but also don’t forget about the importance of investing, saving, and preparing for the future. What’s a girl to do?! I’ve definitely struggled a lot with this, so much so that I even made it my resolution this year to spend more money after realizing that I cut out a lot of fun experiences unnecessarily while trying to hit my financial goals in 2023.
Doing anything to the extreme isn’t healthy, even things that might initially seem like a good idea, like saving money. We should all be able to live our lives and meet our goals without feeling stressed about how much or how little we are doing to achieve them. The “soft life” trend came to mind when I thought about how I wanted to approach my goals this year (especially as they pertain to saving and spending), and I immediately knew I had to adopt it. It’s rooted in cultivating balance, self-awareness, intentionality, and joy, and I think those are strong intentions for how we can manage our finances. Plus, people say a soft life is the secret to success and well-being, and I have that on my bingo card this year.
Ahead, I am sharing how I plan on taking the soft life approach this year with my finances and sharing some inspiration and tips for how you can join me along the way. If you want to enjoy your life without sacrificing your financial goals as much as I do, keep reading.
Do a financial audit to determine what brings you joy
If the words “financial audit” make you panic, I promise you that doing one is not as overwhelming or time-consuming as you’re imagining. Think of a financial audit as a quick check-in with your bank and credit card statements to understand where your money is going and why. While you’re doing this, take note of any additional spending you have done in the last year (or last few months if you want to start small) that’s not your essentials (things like rent, gas, utility bills, and groceries) and consider whether or not they joyfully added to your life or feel frivolous in hindsight.
For example, if you see fast fashion purchases but can’t remember any specific items you bought, that could be a signal it’s something you can cut out or significantly reduce moving forward to help you meet your goals, but if you see coffee shop purchases where you met up with friends, got inspiring work done, or took time for self-care, there’s no reason to cut those out in your soft life era. Your financial audit should help you identify how you can better meet your goals and fuel your joy—because you can have both living a soft life.
Reflect on a future version of yourself
It’s time to whip out your journal, get self-aware, and ask yourself some key questions about who your ideal self is. What does the best version of you do in a day? What do you want to accomplish? The answers to these questions can help you allocate your funds more effectively so they fuel your future. For example, if you see yourself as a marathon runner in the future, maybe you invest in more supportive running shoes, but you decide to switch to a less expensive gym (because—let’s face it: you don’t need to most expensive membership just for the treadmill!). This way, you have the tools you need (reliable shoes and a treadmill), and you can save a few extra dollars each month for marathon registration fees. Thinking about what you want for the future can help you figure out what day-to-day luxuries matter to you, as well as how to balance saving for your bigger goals.
Find the budgeting system that works for you
Identifying a budgeting system that works for you is crucial in minimizing stress, maintaining your lifestyle, and achieving your bigger savings goals. I love the 50/30/20 budget because it allocates 50 percent of your income for needs like rent and groceries, 30 percent for things you want, and 20 percent towards future savings. Even if the numbers aren’t exact in your individual case, using this framework as a rough outline for how much you should allocate to each category ensures you can enjoy life now while also setting yourself up for the future. If the 50/30/20 system doesn’t speak to you, look into other budgeting methods like zero-based budgeting (ensuring every dollar is accounted for) or the pay-yourself-first system (where savings come before other spending). Whatever you choose, know that the best budget for you is the one that you can stick to and the one that doesn’t make you dread checking in regularly. We’re trying to cultivate joy, not dread, remember?
Decide what financial advice works for you
There is a lot of financial advice out there, and it can be overwhelming and stressful to navigate what’s best for you personally. Moving forward, establish boundaries around who or what you listen to and learn from, and only implement tips and advice that feel true to you. For example, if you’re constantly listening to a finance podcast that makes you feel like you’re behind with your savings or retirement, find a new one that makes you feel inspired and excited to invest in your future instead. Similarly, if you work with a financial advisor who doesn’t *really* answer all your questions, don’t be afraid to turn to someone else who is a better fit! This soft life approach will take away the stress that you might be feeling as it pertains to your financial well-being, and you’ll likely see better results going forward.
Set up designated savings accounts with automatic transfers
If I can automate something to make my life easier, you better believe I’m taking full advantage of it. For example, I currently have a “future house” fund, a “vacations” fund, a “capsule wardrobe” fund, and my investments, and each time I get paid, I automate a deposit to those funds from my bank account so I a) don’t forget to and b) don’t accidentally spend it. Once I started doing this, I felt a weight off my shoulders because I had one less thing on my to-do list month after month, and guess what? I have been on track to meet my goals ever since.
If you need help getting started with setting up automation, there are a lot of great apps, such as Qapital and Betterment, that you can use. And remember, even if you aren’t able to save much per paycheck, you can pat yourself on the back for still saving. Plus, having the savings automatically taken out lets you see what you have left for both necessities and fun purchases without sacrificing your goals.
Have a regular appointment to review your spending
One of the biggest ways I was able to hit my savings goals last year was by having a weekly check-in to see how I was doing. This self-awareness exercise helped keep me accountable for both my spending and saving habits and allowed for quick corrections if needed. Take a minute to review what you spent the past week, checking in to see if your purchases are aligned with what makes you happy or were things you needed (toilet paper is never a joyful purchase, TBH). If everything is on track, amazing! If you noticed some mindless spending or didn’t hit your savings last week, don’t beat yourself up for it or try to come up with an elaborate plan to reconcile. Just remind yourself of what you want to spend on heading into the upcoming week and do so with intention.
Would I be a good personal finance writer if I didn’t encourage you to find the best promotions possible before buying? I think not. Especially for bigger purchases, waiting for the right time (like Black Friday, end-of-season sales, etc.) can be hard, but there is nothing better than getting what you’ve been eying (remember those marathon shoes?!) and saving money at the same time (for those registration fees!). Apps like Rakuten or Honey are also great to use to get cashback for things you plan on buying anyway.
While you’re slinging deals and saving, make sure you’re looking for any promotions your credit card or bank might be offering. Oftentimes, banks offer lower interest rates on purchases, higher interest rates on savings accounts, and even free perks! To illustrate this, I recently moved money from one bank account to another that was offering a higher interest rate, taking advantage of a promo they had going on to get a free iPhone. It made sense to move the money because of the interest rate anyway, but then I was able to sell the iPhone and put that money toward my goals for 2024. Keeping an eye out for these kinds of promos can really pay off without requiring any sacrifice!
Use the right credit card
Having a good credit card for big purchases you’ve been saving for and day-to-day things can be a game-changer. Whether you want to travel a lot in 2024 or offset purchases using cash back, take some time to figure out which type of card will help you get to your goals. Since traveling is important to me in 2024, but I also have ambitious savings goals for a downpayment on a home, I’m checking out travel credit cards to help pay for flights (those sign-up bonuses can be amazing!) without costing me a lot of money. The money I’m saving by using the credit card rewards is then heading straight back into my house fund account. As long as you pay the balance off on time and don’t start charging unnecessary purchases, credit cards can be a great way to help you enjoy your soft life now while still hitting your goals for the future.