|
|
|
Why Budget?
Our Budget Book
About Us Share & Save |
Many people never even consider starting a budget because they are afraid they will have to "give up" something. To some, a budget is like a diet that may force them to forgo a favorite treat. In our experience, a diet is the wrong metaphor to use when thinking about budgeting. Myth #1: You have to suffer to use a budget.The truth is, you are following a budget whether or not you have consciously implemented one. Unfortunately, the "budget" you end up with by doing nothing is almost certainly an endless cycle of reactions, as opposed to a dynamic, proactive strategy. A reactive mode contains the double whammy of the anxiety of wondering when the money will run out, and then feeling deprived when it does. A budget will actually reduce your aggravations. An Analogy A more accurate analogy of budgeting is a cluttered hall closet. You know the one—a closet you are afraid to open lest you be hit on the head by a cascade of falling junk. The one everyone puts things into, but never takes anything out of. Picture that closet in your mind for a moment. Now imagine taking everything out and laying it all on the floor where you can see it and study it. Then, give the closet a thorough cleaning, and perhaps install some new shelves or racks inside. Finally, put everything back in an organized, neat arrangement. Do you know what? You will have more storage room than when you started—and you did not get rid of anything! However, it might be that when you have all the junk on the floor, you decide you can probably do without the muddy pair of galoshes with the holes in the bottom, or the broken baseball bat, or the jigsaw puzzle with half the pieces missing. If you get rid of some items, you have even more room in the closet. Organization Will Yield Huge Benefits A budget works the same way. The very act of organizing your finances can provide extra money! During the organization process, you might discover some expenses you want to eliminate, or some smarter ways of handling payments. These choices give you more money still. Myth #2: You have to be in debt to budget.Another popular misconception is that budgets are only for people who are in real financial trouble—individuals who are severely in debt or currently living way beyond their means. While it is true such circumstances require a budget overhaul (or, more likely, implementation), the truth is that everyone can benefit from budgeting. Businesses Budget Because Budgets Work Successful companies, operating solidly in the black and generating millions of dollars in annual revenue, all maintain budgets. Some companies have entire departments, with dozens of employees, whose sole purpose is to run the budgeting process. These companies don't do all of this because they are in financial trouble or are spending beyond their means. They do it because budgets work. Improvements Either Way Yes, a budget can be the road to financial recovery from a crisis. But it can also lead to even more organization, control, and wealth building even if your current financial situation is stable. Myth #3: You have to spend extra hours doing paperwork.Another common fear is that budgeting will take huge amounts of time. With some older budgeting systems, this is certainly true. Even with the newer systems, there is certainly an investment of time up front to get things rolling. However, once you have your budget set up and in place, bill paying sessions turn into stress free, time-efficient moments. You've eliminated the month-in and month-out agonizing (or arguing) about priorities. You also no longer wonder where the money will come from for the next bill that crosses your desk. All of that negative energy and time will have been turned into a positive routine experience! Next: When to Start Budgeting |
|
About Us
Contact Us
Privacy Policy & Disclaimer |
