Are You Mapping Your Money? Here's What it is and Why You Should Do It Ever heard of money mapping? Nope, you've probably just heard about budgeting. Learn about what it is and why you want to do it.

I don't know about you, but budgeting makes me crazy. I all but gave up on it one day when the difference between meeting "all the goals" for the month ended up being one lousy trip to Dairy Queen. It put us over the edge.

Since then, I've embraced the concept of money mapping, a much more dynamic alternative to the strict budget of yore. I mean, who doesn't hear the word "budget" and cringe?

It's time to reinvent the paycheck-to-retirement wheel, and it's okay to stop feeling guilty over spending the amount allocated in the envelope.

What is Money Mapping?

Money mapping simply refers to creating an overall roadmap for your finances. Think about making a giant poster of a road and sticking waypoints on it as you go. You can even get as in-depth with it as picking the month and year that you want to accomplish that particular goal. Actually do create this little map for yourself so you can visualize your life just like it sounds — as a money map. Check out an example of what money mapping could look like for someone just graduating from college:

• October 2021: Start saving in 401(k) — 10% per paycheck.
• October 2022: Have $5,000 set aside for an emergency fund.
• May 2025: Pay off student loans.
• May 2025: Start saving 15% per paycheck in 401(k).
• June 2027: Save $30,000 for a down payment to buy a house in Chicago.
• June 2031: Buy new home, keep old home in Chicago as a rental property.
• December 2061: Retire happily, with at least $3 million in investments.

Make sure you put your map in chronological order. You can create your map yourself with a graphic design software or you can doodle it on the back of a piece of notebook paper. Whatever you do, create it, put it up on your wall or wherever else you'll see it all the time.

Tips for Money Mapping

Money affects all aspects of how you live your life, whether you live in a rental house or own a 3,000 square-foot home, what you eat, what kind of car you drive and more. It even affects your health and mental well-being.

Let's go over some money mapping tips below so you get the most out of your plan.

Tip 1: Allow for runaway roads.

It's such a great idea to take a bird's eye view of your life. That way, you ensure that you get everything accomplished that you want and ultimately retire in a position that will benefit you down the road.

However, does money mapping always go as planned? Of course not.

Much like those truck escape ramps in the mountains for semis on steep grades in emergencies, it's important to make way for runaway events in which your life diverges from what you'd anticipated.

Some kinks in the road will likely show up, and like budgeting, money mapping can help you tell your money what to do so you meet your financial goals. However, the beauty of money mapping over budgeting is that it allows you to change, be flexible and treat the road as an ongoing process with lots of twists and turns.

When the GPS says "proceed to the route," you can veer instead, because you've built in alternative route possibilities for yourself.

What might this look like? Let's say you decide you want to open up your own business instead of working for your current employer. You set up the following runaway roads:

• A new way to contribute to retirement savings, since you're no longer eligible for your employer's 401(k).
• You beef up your emergency fund because you won't have stable income coming in, especially during the first year of your business.
• You make a plan for paying for quarterly taxes, as well as doing everything else you need to do to set up an LLC or another type of business.

Tip 2: Create money ecosystems.

Just like you learned in biology class, an ecosystem refers to a geographic area in which many organisms, including plants and animals, weather and landscape, work together to sustain life. A healthy ecosystem depends on several factors and very specific situations in order for the animals and plants that live there to thrive. A frog needs a supply of fresh water and plenty of bugs, plus a shelter to hide from raccoons and snakes and a place to lay eggs.

Your money is no different. It depends on a very carefully calibrated set of circumstances to reach your goals.

On your money map, try to envision factors that may threaten your perfectly created ecosystem. If the water becomes polluted, the frog can't live there. You may want to say to yourself, "If X happens, then I can't do Y," or "If X happens, then I'll do Y."

• "If I get a divorce, I can't build my dream house."
• "If I spend too much money on a home, I can't save the 15% necessary to retire at 60."
• "If we experience another recession, I'll keep investing like normal."

Sometimes you need a dose of imagination to both allow for runaway roads and also create money ecosystems where your savings and investments can thrive.

Tip 3: Trigger automated investing at different points in your life.

When you want the most under-the-radar approach to investing, set up automatic investments. Then you don't have to wonder whether you've invested for your kids' college education that month — it's already done.

In addition, consider how you'll trigger automated investing at different stages in your life. How will you start automatic investing based on what's appropriate for your particular life stage? For example, if you have a baby, cue the college savings plan. Buying a home might mean starting a fund for a kitchen upgrade — that sort of thing.

Whatever automated investing you'll need to set up, add it to your money map.

Follow Through After You Map Your Money

Executing your plan: Often the hardest part of money management. However, consider what will happen if you don't map your money. Take a look at the last goal on your money map. What does it say? Does it mean you'll have to say good-bye to that particular item? Will you be okay with doing that?

What happens if you can't follow through? What if you don't have enough money to make the items on your money map happen? Usually, you can save something — many people just assume they can't because they feel strapped for cash.

However, by cutting back on vacations or groceries or other expensive lifestyle habits, you can usually finagle enough savings to reach your goals — especially if you really want to meet them.