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5 Reasons You Need A Budget Now

Wait! Don’t go, just because I said the “B” word! “budget,” that is. I know it is tough to think about making a budget, but it really is a good thing! I promise! But first, think of three big dream things you want someday.

Have you got them? Good!

Big Dream Items

 

 

 

 

 

 

 

How are you going to make them a reality? You need a plan for your money to make the dreams happen. And a plan for your money is …wait for it…a…Budget!

1. A Budget Actually Helps You Determine What Is Most Important to You.

Because you have limited funds, you must decide where those funds go each month. Once you start to do that you are more likely to let go of expenses that aren’t as important to your bigger plan.

This is especially true of items you purchase on a daily basis. Many convenience items significantly reduce our discretionary money, but because they don’t cost a lot per day, you don’t realize how quickly they add up.

2. A Budget Shows You the Money Leaks

Once you see where spending is out of control, or not lining up with your plan, you can reroute those funds to more important categories like debt repayment for instance.

Most people are shocked at how much a daily latte habit takes from your budget. A grande latte from Starbucks at $3.65 each time 5 days per week is almost a thousand dollars gone in a year! ($949, to be exact).

Wouldn’t that buy a nice TV? Or pay several car payments? Or the bills from last Christmas? Maybe it would cover one month of your emergency fund.  How will you know what to cut out if you don’t know where the money went?

3. A Budget Can Reduce Fights Between You and Your Spouse

A budget Reduces Fights

Everyone fights about money sometimes! It is one of the biggest stresses in a marriage and often the cause of divorce.

So learning to budget together can relieve not only your financial stress but also marital stress. Isn’t that a terrific side effect? Don’t you think working together on some big goals like paying off debt will strengthen your marriage? It did for me!

Because you decide on the discretionary categories ahead of time, the budget becomes the “bad guy” when there isn’t enough money for your splurge. If you had your budget meeting and you agreed to your numbers for the month, then you bought a ticket for this ride! No fair grumbling to your spouse! Besides you can jot it down to include for next month.

You Both Want Some Control Over the Money

One important tip to remember even though you want to just pound the debt is that you should allow each of you a pre-decided upon amount to spend however you like. Having that little bit of splurge money will keep you on track far longer than trying to pour everything on the debt until you’re sick of sacrificing and you just give up.

Honestly, once you do allow the splurge for a few months while you’re just beginning, you may find that you are both willing to decrease the splurge amount to turbocharge debt repayment. But even if you do cut back on splurge money, please keep something in the category to motivate you on a paycheck to paycheck basis. Consistent rewards keep you focused on the big goal.

4. A Budget Is A Guardrail That Lets You Know When You’re About to Overspend

For example, if you use the envelope system, and there is only $10 left in entertainment, you can’t buy concert tickets this month. (Although if you had a budget, and knew your favorite artist was coming in summer, you would have been saving up for the concert!) See what I just did there?

Have you ever opened your Visa bill and freaked out because it was $500 more than you expected? Oh, it was no big deal to go out to dinner two extra times last month, and you just had to have the new towels that were on sale. One of you is upset and the other may be in trouble because you had no guardrail to stop you from blowing your paycheck.

Knowing that you’re about to overspend is the most effective reason to input your expenses as they occur. You don’t want to go over budget and give up. It keeps you from going “over the cliff” to crash and burn. You can use an app like Everydollar, You Need A Budget or Mint, that automatically track expenses once you are consistent in recording them.

If you find you’re relying on credit to support your lifestyle you can find help at this post about debt. In it, you will find a place to sign up for a link to a debt snowball calculator.

5. A Budget Will Get You To Your Dreams!

Once you’ve realized that a budget isn’t a bad thing, you can make it work for you. This is truly what it was designed for all along. What you may not realize is that when you start with some big dreams in mind, your subconscious mind will be helping you look for ways to make the dream happen. Don’t get me wrong, you still have to do the work, but now you have something important to you to strive for!

Can I tell you a secret? Write these big dreams down, and the steps you need to achieve them. For example, how much do I need to save each paycheck to get the dream by the end of the year? People who write down their goals are 42% more likely to achieve them! Isn’t it amazing that 15-30 seconds of effort boosts your success by almost 50%! Quick grab a pen and start scribbling!

 

Are you ready to make friends with the budget and put it to work for you now?

 

 

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