Personal Budgets That Work
We all have come across myriads of budgeting software.In fact a budget may as well be a verb seeing the way everyone is always talking about it. I have created more budgets in my life than I can remember and the failure rate for such budgets is higher than my college exam scores. Whether you are in business or are employed, a budget is essential for all. How come we never seem to follow any budget that we have set up?
It took me a long time to understand that budgets are not meant to be made from the air but are highly dependant on what my personal circumstances were. Before I set up any budget, these are the tips I normally follow.
1. Know Why I need The Budget
A budget for the sake of one is just an opening for failure.There must be a purpose why you need to budget and that is what will make one follow it. In short, any budget that is created must have a goal to be achieved. I like my goals being specific and to the point. Making a million dollars is not a goal but a wish. However, if I state that I need to make $10000 to pay off my credit card, then I will be more motivated.
I might need to pay off the credit card because, I tired of working for the credit card company . Such a specific goal oriented budget has a greater chance of surviving especially on those days when I don’t wish to follow the budget.
2. Get the Specific Budget Numbers
I can assure you that ignoring the $5 that you used for buying a cigarette or that was left in your handbag in the evening , is a sure way to break a budget. Keep track of each and every dollar and coin that you have. You will be surprised at how much money you have at the end of the month. Every dollar you have earned is a dollar you should be saving , tracking and budgeting.
Get a piece of paper and write everything down. If you don’t wish to carry the coins, get a piggy bank.
3. Get a Realistic Budget
Every time I have tried to deny myself things, I have ended up more depressed and not any richer. You only live once and even if you have a great need to control how you spend your funds, it does not mean that you should deny yourself the things that make you happy. Instead of doing away with eating out all together, why not reduce the number of times that you do eat out or even change the venue that you go to.
I found out that even a McDonalds was a great venue as long as my kids were happy and the people I was with were fun to be with. So instead of hurting and depressing yourself , reduce the amounts that you use for miscellaneous entertainment but don’t just go gung ho on being a hermit.
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[...] started to discuss how I normally set up my budgets. It is always interesting how we all end up with budgets that we have absolutely no intention of [...]