How to Balance Your Finances No Matter Where Life Takes You

There are a few basic personal finance "best practices in life: get a budget, pay off debt, buy insurance. The times we learn these practices happen in different moments, though, often throughout our 20s and 30s. Some such moments include solidifying our careers, settling down with a partner, choosing a forever place to live, etc. It's in these moments when we start the process of learning how to make our money work for us.

But what if you want to think more about your financial decisions, but life still doesn't seem stable enough to do so?

In the last six years, my life and money have had a lot of twists and turns. I tackled a shopping addiction, moved to two new cities, underwent three big career transitions, bought a home, and paid off more than $20,000 of debt. Throughout all of this, I’ve come to learn a thing or two about staying positive about finances even when life swerves in big (and often unplanned) ways. Here are the five most important things I’ve learned:

My Top Five Lessons on Balancing Your Money in Unstable Times

A Savings Account is Key

When I graduated from college, I was $10,000 in credit card debt from the aforementioned shopping addiction. I worked with a therapist to kick the bad habit, but as a newly minted college grad with a former shopping problem, I didn’t have any money saved. Any extra I made went to keeping up with my exorbitant credit card minimums.

Not wanting to let my bad money moves prevent me from pursuing my dreams, I moved to New York City in 2010 with just $300 in my pocket. I thought if I could just get there I could finally get to work building my dream career as a Broadway star. So, I packed up and left with no money and no safety net.

But then cold, hard reality set in. While my friends were working at Starbucks and going on auditions, I took a desk job at a hedge fund just get my bank account back in the black.

Even though the job was terrible, I made a great financial decision by making the sacrifice and commitment to a desk job until I paid off my debt. That experience also taught me an important lesson: bad money moves can and will set you back. That's why it’s important to have some money in savings, so you never have to put your dreams on hold.

At the Bare Minimum, Stay Present

I bought my first home at age 26. This too was (ultimately) a good money move, but I ended up making a lot of big, expensive mistakes with the purchase and renovation. These mistakes were largely due to my naiveté as a first time home buyer. After all the hard work of paying off $10,000 of debt in New York, just three years later I found myself negative again. This time, the debt was $8,000, thanks to a runaway home renovation and shady contractor.

This was an emotionally exhausting time for me. After buying my first home, undergoing a $60,000 renovation, and then undergoing a legal dispute with my contractor, I also called off my engagement...all in the span of six months. Needless to say, I was drained.

This emotional exhaustion led me to do something my personal finance blogging self almost can't believe: I buried my head in the sand. I didn't think about my debt at all. Instead, I chose to rest and focus on healing myself emotionally before I began the process of healing my finances.

Sure, I kept up with the minimums for over a year, but I didn’t get serious about paying off debt until early 2015. I paid it off in full that year, but I'll never forget the overwhelm I felt. And I'll never forget the necessity I felt to just to let things lie for a little while, personally, professionally, and financially.

If you're going through something like this, understand that sticking my head in the sand didn't serve me the best. The best thing you can do for yourself in a situation like this is to stay present. Even if you can't make progress, you can make sure you're not letting anything slide backward. (And that in itself can be progress when you're really feeling weighed down.)

Sometimes the most we can do is just get by - and that’s okay! Maintain that sympathy toward yourself when you're feeling financially overwhelmed.

Set Three Big Goals Every Year

I don’t like to get too bogged down in the details. That's why I write down my top three financial goals for the year at the beginning of each year. My goals are usually a mixture of big and small - not every financial goal has to move mountains. For example, I would list things such as to pay off debt, contribute to retirement, open a checking account, replace the roof on my home, and so on.

Once you have your “big three” in mind, reverse engineer your goals and monthly contributions. If you’re just getting started, your big goal for the year could be to save up $1,000 in an emergency fund, or enroll in your employer’s 401k program. These are just a few ideas of what you could do.

Let’s face it: wealth isn’t built overnight. Neither is financial stability or security. Small steps are not only perfectly acceptable. In fact, they’re encouraged.

Practice Self-Love

People are becoming more invested in treating themselves better these days. We're changing the way we eat, the way we exercise, and the way we spend (such as using money for experiences instead of things). All of this can be seen in the boom of the self-care industry, and the message is clear: we're living in an era where people want to take better care of themselves.

But why doesn’t this self-love extend to personal finance?

My favorite mantra is that “money is a lifelong process.” I adore this because it carries such a spirit of self-love toward our finances.

Why is money a lifelong process? Because most individuals begin managing their money between the ages of 18 and 22, and then they’ll manage it well into their 80’s and 90’s. Over the span of so many decades, it’s not only expected for your money situation to change, it’s a given.

The way you manage your money in college will look drastically different than the way you manage it in a marriage or retirement. And in those times when your life situation changes, your money situation will too. Most likely, in those instances, you’ll have to relearn how to best manage your money, which can be very frustrating.

From my experience, I thought I had everything figured out by the time I turned 28. I paid off the debt from college and the home renovation. I was a homeowner making a good living working full time in marketing and I had a sweet blog “side hustle”. I had zero debt and the retirement contributions on lock. Frankly, I was killing it at the money game.

Then I woke up one day and realized I wasn’t living my best life. I didn’t want to work in an office, and I yearned to try out freelancing and be my boss instead. So, I took the leap and quit my job, and my money situation completely changed. Suddenly I had to contend with an uneven cash flow and I had to learn how to budget an irregular income - on top of building a business.

I’m still trying to figure out what works best for me, and it’s been almost two years since I started building my business. This process has been a humbling experience, but it taught me a beautiful lesson about embracing chance and going easy on yourself when things are in flux.

Don’t Let Money Hold You Back

When I was contemplating leaving my full-time job to work for myself, I ran the numbers and did my homework on how the transition would impact my finances. While financial homework is always good (and recommended), it doesn't always tell the whole story.

My homework told me I was going to be taking a pay cut, but I left anyway because I prioritized the opportunity to learn and grow as a business owner over earning as much as my full-time salary.

Yes, you should always consider the “money” side of a situation. But then make a decision based on what's best for you all around. Risks are defined as such for a reason - we don’t know exactly how they’re going to impact our lives moving forward. But sometimes we just have to take the leap. The lesson? Think about money, but don’t let it rule your life.

You know the best thing about money? It's not finite. In fact, I’d argue that money is the most fluid thing there is. At the end of the day, it’s just math. Is your net worth negative? Work hard and cut back and make a plan to put it in the red. You have control over all of it. It’s thrilling!

Don't Forget: Money is Personal

At the end of the day, money is a deeply personal experience. I find that a lot of personal finance literature fails to acknowledge the reality that the way folks handle their money is largely dependent upon what they have going on in their lives at the moment. From marriage to kids to buying a home, to changing jobs and cities, it all varies per person per circumstance. Money just isn’t one-size-fits-all. What's more, life is going to throw a big curve ball at one point or another, so it's important to be ready by understanding what's important to you.

So, how do you manage your finances for the long haul while sustaining good money momentum now? All you have to do is understand that it’s okay to throw out a few of those hard and fast personal finance basics. Take the basics into account and then create your own rules during times of change. And don't forget to infuse a little more kindness to yourself as you go.