Does Your Budget Work
You spend hours every week working on your budget. You have the task of assigning money to your various categories and subcategories. After you’ve assigned a dollar amount to each category, you have the spending journal to deal with.
After writing the new budget, you must make a spending journal for the new month or pay period. Tracking your spending with a spending journal simplifies your job but still takes time.
You’ve dealt with earning problems and spending problems, and you know how to save money.
You are getting closer to being a month ahead of your bills.
The question is, does your budget work? You would say yes because you are getting closer to being a month ahead of your bills, which is one of your short-term goals.
But it’s different for some. Some people have a lifestyle that keeps them from using a consistent budget, like the 50-30-20 budget.
Maybe their rent needs to be lowered, or they have more debt to pay than you do. Many reasons can cause you to feel like your budget isn’t working.
Maybe it is, and you don’t know it yet. More about this later.
What Is A Budget
A budget is a schedule for how and when you spend money. Think of a budget as a road map telling your money where to go.
Before you can have a successful budget, you need to take the time to sit down and write it out. Make plans to live within your budget. A reasonable budget will help you live within your means.
What Is The Importance Of A Budget
Budgets are important. They help you create financial stability. Using a budget and tracking your expenses makes it easier to pay your bills and build an emergency account. Overall a budget puts you in a position of power. You have control of your money.
What Is The Purpose Of Budgets
One benefit of using a budget and living within your means is that you are in control of your money.
Help You Work Toward Short And Long-Term Goals
Where do you want to be in 5 years, 10 years, 20 years?
Some want to buy a house, live abroad, return to school, get married, and so much more. A budget will help you achieve these and other short and long-term goals because you plan and save for what you want.
Part of the function of a budget is to help keep your living expenses low so you have more to save. The more money you save, the more likely you are to achieve your goals.
Keep You From Overspending
Very few things work without boundaries, and budgeting is one of those things that is a safe boundary for you.
Think of budgets as rules for a game. If you do these things, you win; if you don’t, you will probably lose the game.
Budgeting is much the same way. To achieve a specific goal, you need to do certain things to claim it.
In our lifetime, money makes the world go round. Everything you need and want will cost you money. To have the life you want, you need to have money, but if you spend all of your money each month, you won’t have the cash you need for the short and long-term goals you set for yourself. Using credit will not get you where you want to go.
Makes Saving For Retirement Easier
I’ve never heard anyone say I sure hope I’m broke when I’m old and have to work until I die. But it happens every day.
To retire with dignity, you must do one of two things. You need to save for retirement or retire in a foreign country like the Philippines or Cambodia. There are others you can retire to and enjoy life, and it’s much cheaper than living in America.
The point is you need to plan and save for your decision.
If you decide to retire to America, it will cost you more than social security pays. You’ll need something else. You need to save and invest for your retirement.
You can incorporate this long-term goal into your budget and save for it.
Helps You Prepare For Emergencies
We never know what the next emergency will be, making it difficult to plan for.
The experts recommend six to twelve months of living expenses for emergencies.
Setting money aside for emergencies is easy to incorporate into your budget. If you should have an emergency, you won’t be left having to borrow money or looking for help. You’re self-sufficient.
Does Your Budget Work
If you say no, be careful because budgeting is a growing process. Some budgets take time to work because of previously existing conditions like too much debt or spending too much on housing. And it takes time to pay off debt or find a cheaper place to live.
Does your budget work? Think of it like this. If I continue to use this budget, will I have a budget that allows me to save money, pay my bills and improve my lifestyle? If yes, I will continue this route, and your finances will improve. Your budget is working.
Budgeting Tips
As you work on your budget, here are a few things to remember. These budgeting tips will help you weather the budgeting pains.
Be Patient
Rome was not built in a day. And you will not get your finances under control today. Be patient and work with your budget until you can live within it.
If the debt is a problem, it may take time to pay it off, and of course, depending on how long that takes will determine how fast or slowly you can send that money to save for something you need or want.
Be Goal Orientated
We need goals, or we need to be ineffective and stagnant.
Set goals for yourself. Ensure your goals are measurable and trackable. A goal may be to save five dollars a week for a year. You can easily chart that on the calendar and see your success as you save.
Set Reasonable Financial Goals
The problem with setting goals is most people set goals that are not reasonable. When they realize the goal is unreasonable, they quit.
If you realize later your goal is unreasonable, change the goal but don’t quit.
Working with a budget is a growing experience, and it will not happen overnight, but it will happen if you work it daily.
Living within your means and using a budget is so worth it.
Conclusion
Does your budget work? If you just started today, probably not, but if you continue to work with your budget, strive to save money, and live within your means, your budget will work. Just don’t quit.