Many people simply don’t know how to budget money. They try it for a couple months, and when it doesn’t work out the way they thought it would, so they get frustrated and quit.
The fact is that budgeting money is simple, IF you know how to do it. However, it can be an extremely difficult task if you do not possess the knowledge of how to get started and how to stay on target.
"The only way not to think about money
is to have a great deal of it.”
- Edith Wharton |
With some basic education, however, you can be successful. It simply takes time and patience to get it right. So don’t allow yourself to get discouraged! Keep at it, and follow these basic guidelines.
First, it’s helpful to take a month and simply monitor your spending. Write down every penny you take in as well as every penny you spend. That way, you’ll have an accurate record of your actual spending and earning habits.
Once you have that, you can look at the list and determine which expenses can be reduced or eliminated. You may have discovered, to your horror, that in a typical month you spend a total of $50 at Starbucks. (It adds up faster than you think!)
Maybe you’ll vow to cut that down to $20. Perhaps there are subscriptions or memberships that you hardly use that you could cancel. Maybe you can carpool to save on gasoline - another item that tends to be more expensive over the course of a month than you think it’s going to be.
Armed with all this knowledge, you can quickly determine what expenses can be reduced or eliminated entirely. You can prepare a new, revised budget that takes into account your plans to reduce expenses - and here is where you need to give yourself some leeway.
You might resolve to spend only $20 at Starbucks, but as the month goes on, you might discover that realistically, there’s no way you’re going to spend less than $30. And that’s OK, if that is a priority of yours that you simply can’t give up.
You COULD resolve to live in total poverty and not spend a single dime on anything that isn’t absolutely necessary. Some people do that, and they definitely save more money faster. But most people can’t realistically do that.
While you are encourage to become as aggressive as possible in paying off all your debt, the ultimate decision is yours. Making incremental progress over time is the ultimate key measurement. How fast you proceed is totally up to you.
So one of the important parts of how to budget money successfully is to allow yourself to get used to the new, streamlined budget.
Realize that it’s going to take a few months to get used to it, and that you might slip up on occasion. Think of it like a diet: Just because you lose your willpower and eat a candy bar one time doesn’t mean you have to quit the program altogether.
If you mess up, admit it, and get yourself back on track as quickly as possible.
"One way to solve the traffic problems of this country
is to pass a law that only paid-for cars
be allowed to use the highways.”
- Will Rogers |
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Debt is NOT your friend. It's not a wonderful "tool" for building wealth. That's a myth.
