The fact that you clicked on this post tells me that you and I already have something in common. You see it wasn’t too long ago that I too hated to budget. After years of trying to figure it all out, I’m here now to tell you not just why you don’t like to budget, but how you can learn to almost enjoy it. (Please note I didn’t say LOVE to budget – I said ALMOST enjoy it!)
First, why bother budgeting?
In order to reach any financial goal you have to budget. A budget is the foundation of any financial plan. You cannot pay off debt, save money or invest without knowing where your money is going. Remember, a budget is simply a tool that helps you tell where your money to go – otherwise you’ll never know where it went.
Now, here are what I believe to be the top 3 reasons why you hate to budget and suggestions on how to overcome them.
1. No one ever showed you how
It’s not your fault. No one ever took the time to teach you.
During all of my school years, and even that of our daughter’s, I have never seen budgeting offered as part of any school curriculum. So is it any wonder that debt continues to rise among American households? The average American household carries an average of $16,748 in credit card debt alone. According to a recent Gallup poll only 32% of families maintain a household budget with only 30% having a long-term financial plan that includes savings and investing. I believe that creating a financial plan (a budget) and working hard to stick with it is the answer to avoiding personal debt.
So what’s the fix?
As Financial Coaches, Brad and I have created a number of great blog posts that everyone can learn from. If you are ready to begin budgeting but are unsure of where to start check out these three tips to help you get started. (Also, at the bottom of this post be sure to sign up to receive free budgeting spreadsheets!)
If you aren’t budgeting because it seems too complex, you should check out the 50/20/30 rule of budgeting. It’s one of the easiest, most flexible budgeting options available.
As part of our financial coaching services we can help you create a budget that will help you achieve your financial goals. We can assist you in working towards paying off debt and student loans, saving, investing, college planning and retirement. We will walk along side you and be there for you every step of the way.
2. Not setting goals
I love this quote:
“If you aim at nothing, you will hit it every time.” – Zig Ziglar
The truth is you will never make any progress without setting goals.
I have found that setting one large goal, like paying off all of my debt, is too overwhelming and I accomplish nothing. However, if I take the time and set smaller more attainable goals on the way to that one bigger goal then it isn’t as overwhelming. So instead of simply saying you just want to pay off all of your debt you start by saying I will first pay off my Visa card then I will pay off the MasterCard. By using this approach you can see progress and seeing that progress is motivation to keep going. Then before you know it you will be debt-free!
This approach works on anything you are trying to accomplish. Want to lose weight? Grow wealth? You need to look at what your big goal is then set smaller more attainable goals on your way to reach that big goal.
3. You have to know your why
It all comes down to priorities.
Just like spending our time, we all spend our money on things that are important to us. However, when we know we need to make a change there needs to be a shift in one’s priorities. In order to stick with a plan or a budget long enough to see real progress you need to know your why. You need to take some time either on your own or with your spouse and ask some questions to first figure out your priorities – and second to establish your why.
Perhaps you can start here:
Why do you want to get out of debt?
Why do you want to grow wealth?
Personal budget percentages: Here’s where our money goes
3 Tips for Living the Good Life (Without Going Broke)
BOOK: Life Planning for You: How to Design & Deliver the Life of Your Dreams
Our personal whys
For us we wanted to get out and stay out of debt so we could live less stressful lives and build wealth for our future. We wanted to save money and help our daughter pay for college so she wouldn’t have to get tied down with college loans. We wanted financial flexibility and options that would possibly allow us to retire early.
Those are our whys. And there is no way we could have achieved our financial success without having goals and having a plan (a budget) to hit them.
What about yours?
What’s most important to you and your family?
If your why is not strong enough then you will never stick to your budget long enough to pay off debt, or make any progress in growing wealth.
I truly believe that with a little study and some practice along with some goal setting and establishing your why you will grow to maybe not love budgeting, but perhaps enjoy the fruits of it. Because budgeting at it’s very core is just a tool that can help anyone get out of debt, save money and build wealth. And once in place it can be the very thing that helps you with your financial success!
Are you ready to begin your budgeting journey? Now that you have the tools and resources to get started – what’s stopping you? Get started today!
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