Three Great Reasons for Having a Budget

by Tom Tousignant

in Blog, Budgeting, Wealth Building

Many people hate the word ‘Budget’.  It leaves them feeling restricted, bound up, and takes away creativity.  Nothing can be further from the truth.

A Budget is simply a plan on how you will use the money entrusted to you over the next month or year.  A plan allows you the freedom to operate within reasonable limits, and allows you to find creative ways to make the budget even stronger.

Budgeting is critical for financial success – so why do so many people ignore it?

In my opinion, there are three reasons:

Reason #1

Often; we ignore budgeting simply because we don’t have specific goals for our spending. We go merrily along thinking, “Well, I’ve made good money this year so hang the expenses. Who cares about them?”  Or, “Hey, I can make the minimum payment on the credit cards and then catch up next month”.

You can guess where this attitude leads – straight to out-of-control spending because you don’t have the “brake” of a budget to keep you on a secure financial road.

Reason #2

We simply don’t know how to budget! We were never taught how to do it by our education system (a criminal shame, in my opinion)! If I had my way, budgeting would be a mandatory subject in every school in the land!

I think we would be much better off knowing how to build and follow a spending plan rather than calculating some of the Geometry problems my high schoolers are assigned.

Reason #3

A budget simplifies your life, reduces stress, and helps you achieve your goals.

In our consumer-driven economic system, we’ve all been taught to spend and not save.  Every day in every way on the media (TV, radio, print, etc.), advertisers urge us to spend, spend, spend.  Needless to say, this is financial insanity.

So how do we restore the sanity for ourselves? You already know the answer, don’t you? By creating a plain old, boring, yet essential, budget.

But how do you budget effectively? Just take some common-sense action steps!

So, learn how to, and practice good budgeting to succeed financially.

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