By Martin Lukac
Budgets have gotten a bad name for limiting how much you can spend. But that isn’t the actual truth behind a budget. A budget does limit your spending, but it does so in order to let you have money for the things that you really want. It gets you where you are going in life financially. Without it, you are wandering aimlessly around.
Have you ever sat down to pay the bills and be filled with worry over how you will make the ends meet? Have you gotten your credit card bill just to be silently shocked at the amount? Do you have regret after shopping? Do you have any idea how much money you have in the bank at this exact moment, or are you spending blindly?
Have you noticed how much stress money can bring to your life?
There is a solution.
You have to form a budget. A budget is simply a guide that helps you get where you are going financially. You may have goals and things you want to do, but you will never get there if you don’t have a budget.
The key is to find a budgeting format that works for you. Most people fail at budgeting at their first try and simply give up. One of the problems is that they are trying to fit their finances into a form or preset budget designed by someone else. This almost never works. We all live in areas with different costs of living. I can spend a lot less on groceries in Oklahoma than can someone who lives in New York City. The same goes for rent, insurance and entertainment costs. You have to look at what you are spending before you know what you can cut back to.
Set yourself realistic goals. With a budget, you look at what you are currently spending and find ways to cut back. But you have to be realistic. You can’t just allot yourself $100 a month for groceries when in reality you spend $400. That is where tracking your spending comes in handy. You are able to see what you are spending before you try to cut back.
Most people never realize that they are living beyond their means until the debt begins to add up. Credit cards make it really easy to just spend without thinking. You need to know every day how much is left in your checking. If you use a credit card, make sure you know every day how much you owe on it. You should never charge more than you can pay off each month.
It really is much easier on you to stop and spend five minutes every night writing down your spending for the day. This will eliminate the three hours you spend every other month trying to get the check book to balance. It saves you a lot of time and stress. Plus, you know exactly where you are in regards to your budget.
There are many budgeting methods out there to consider. I am particularly fond of the cash/envelope method. I also like to use my budget as a way to make sure that all my bills are paid on time each month. I just go down the list and check them off. That way, if I don’t receive a statement due to a computer glitch, I know that I need to pay the bill over the phone or other method.
Budgeting helps you get things straight in your mind. You will be surprised how easier you sleep when you’ve taken a little time to focus on your finances. Budgeting helps you to save time, stress and money.