Recovery Audit: 10 Things You Need to Know to Master Your Finances

There’s a flurry of financial activity in most households across the country in April – a flurry that lasts a few hours or a few days depending on the circumstances. If you are in early recovery, taxes may be one of the first big challenges you face sober, and it’s a good idea to purposefully view the process of dealing with finances as an opportunity to create positive structure for the rest of your recovery.

How? It’s true that money doesn’t buy you happiness, and it certainly won’t buy you sobriety. But when you have money, you have choices – choices in where you will live, the kind of food you will buy, and what kind of job you will take. And all these choices can impact your ability to stay clean and sober for the long-term.

Ready to get your finances in order and give yourself another tool to manage your future? Here’s how:

1. You must have goals. Just like you have goals in treatment that help you to define what it is you want to accomplish, when it comes to your finances, you have to know what you want and be able to articulate that. It may be something simple like, “I want to save $1,000 for an emergency fund,” or “I want to be able to pay my rent every month in advance.” Whatever it is, know what you want to do so you can budget accordingly.

2. You cannot avoid having a budget. In order to accurately know what you have coming in every month and where all your money is going, you are going to have to spend a month tracking every single dollar you spend. Did you get quarters for the laundromat? Write it down in the household supplies section. Did you spend $2 on a bottle of water? Write it down in the food category. No amount is too small. Though it may seem tedious, if you don’t know where your money is going, you won’t be able to make it work for you.

3. It takes work. This isn’t necessarily going to be easy, but like everything in recovery, it is worth the effort. After you track your budget for a month, identify the areas where you can cut back. The more you don’t spend, the more you have in hand to achieve your financial goals.

4. Success is in the details. Writing down where every dollar goes and cutting back on unnecessary spending is all about the little choices in life. When you buy a birthday present for a friend, do you have to buy the big gift bag and oversized bow? When you get coffee, if you don’t make it at home, can you get the small cup rather than the large or opt for a black coffee instead of an expensive latte? It may seem like a small thing, but it’s the small things that add up.

5. Habits make a difference. Break down those categories on your budget so you can really define where your money is going every month. Know what exactly is going into that entertainment category and how often. Is half your food budget being spent on pizza delivery or takeout? Do you have five different TV streaming services and cable? Consider some of the habits you have that contribute to your spending and how a few small changes can add up to big budget cuts that will really drive you closer to your financial goals.

6. There’s an app for that. Not interested in budget forms or Excel spreadsheets? There are a number of different apps, many of which are free of charge, you can download to help you manage your budgeting from your phone and even a few apps that will send you inspiration throughout the day.

7. There are a ton of resources available for free. Trying to cut your entertainment budget but still want to have a good time? Head to the library and reserve some movies for free rather than spending money on cable. Need help figuring out how to manage your tax forms or how best to budget your income? There are a number of nonprofit organizations willing to help you do just that, free of charge.

8. It’s good to have a backup fund. As you go through the process of saving for your financial goals, it is a good idea to have an emergency fund to help you. Somewhere between $500 and $1,000 will help to make sure that you are not caught off guard if emergency strikes.

9. An advisor can help. If you are managing larger sums of money or facing off with the IRS about back taxes or unpaid penalties, it can be helpful to connect with a professional who can help you. Many are available at low-cost or sliding scale prices, and in many complicated cases, you will definitely get your investment back in advice and money saved.

10. Fall off the wagon? Climb back on. So, you committed to your budget and then had a couple weeks where you went on a spending spree, going out to eat every day and buying everything that wasn’t nailed down? Just like in recovery, when you lose your path, whether it was a one-time slip or a binge that lasted for weeks, you always have the opportunity to turn it around and get back on track.

What will your first step be to put your finances in order and shore up your ability to make positive choices for yourself in recovery?