BUDGET FOR FREEDOM! – HOW TO WIN USING A BUDGET
Why Should I Budget?
As a short mental exercise, let’s begin by naming some things you can quickly find out via the internet:
Gas prices? Yep.
Restaurants around me? Sure thing.
Movie times? Choose your theater.
Bank account balance….?
Did you tense up a little on that last one?
If you asked me about two years ago, I would probably answer yes. I frequently found myself nervous about checking that balance.
In fact, on more than one occasion I can distinctly recall giving myself a pep talk before hitting the “log in” button on my accounts.
Usually this was something along the lines of, “Just do it. Checking it won’t change anything, but at least you’ll know.”
When the pep talk failed, no problem. I could always check when payday rolled around.
My point is this: even though I was free to look anytime I wanted, I didn’t feel free at all.
It’s not that I was constantly on the brink of financial ruin. In fact, considering my lack of awareness, I was really doing okay.
But here’s the thing about okay: It’s not.
Okay will get you from one paycheck to the next, but that’s no way to exist. And yes, you can make that work for now, but what happens when you hit retirement and the paychecks stop? What happens when the car needs to be replaced? What happens when the AC goes down, or the kids outgrow their clothes? (I could keep the fear mongering going for a while, but surely you see the point.)
Okay leaves you happily ignorant of your immediate financial position and in denial of any long term needs.
I was happily “okay” for a long time, and then I wasn’t. Again, not because of any tragedy. I just happened to be in the right place at the right time getting asked the right questions by the right people. Through that conversation, I realized I needed to learn more. I needed to figure out this whole personal finance thing.
And where does that begin?
With a budget.
And what exactly is a budget?
A budget is a plan for your money.
And that is where freedom and finance meet. You get to do whatever you want (freedom) with your money (finance).
I’d offer one rule in two parts: Make your plan before you get paid, and once you make it, execute it.
If you do this, several things will quickly become apparent. First, you’ll feel in control financially, and that’s a great feeling. Second, you won’t be afraid of your account balance because you’ll know exactly what it should be before you even check. And lastly, you’ll have the power to give yourself a raise, because when you find you need more money, you’ll know where to look for it.
The budget.
Remember, regardless of your money goals, you can “Bank on a Budget” to get you from where you are to where you want to be!
Make your plan before you get paid and, once you make it, execute it.
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Anyone else ever found themselves nervous about pulling up an account balance??
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