Hey, where did you go?
Have you ever looked at your checking account and asked your money that? It’s time to cut it out. And the best way to tell your money where to go (rather than ask it where it went) is to use a budget to keep track of your money.
No pain, no gain
Budgets don’t always seem like the most enjoyable items. But getting stuff that you want is. So if creating a budget is the quickest way to get the things you want, why do so many people cringe at the thought of creating a budget?
Most people think of budgets as something that tells them what they can’t do with their money instead of what they can. But it doesn’t have to be!
From the right perspective, a budget is something that tells you how you spend your money. When you know where your money goes, you can put some reigns on it, and control it by taking ownership over your budget.
Customize your budget for less pain
Budgets don’t have to come in one shape and size? Absolutely not! At least, they shouldn’t.
Think about it this way: if you buy a house that has a hideous coat of paint on the front, what are you going to do? Look at the house everyday and feel helpless because that’s just how the house came? Or are you going to pry open some paint cans and get to work?
The same principle applies to your budget. Look at sample budgets and customize one to work for you. Cut out parts that aren’t applicable to you. Maybe there are parts that you would like to include, like savings or investing, but you aren’t ready to include just yet. That’s okay. Cut those parts for now – but add them back in as soon as you can. Don’t get turned off by the whole process just because one or two pieces cannot be perfect right now.
And while you’re changing around your budget by cutting things out, don’t be afraid to add parts.
How to build your first budget
Begin your budget by looking at your monthly income. Be sure to include your official paycheck(s), but also money that you are frequently gifted with, and any sort of interest that you may be earning through savings accounts.
Next, look at your monthly expenses. Which bills do you have to pay? Which payments (like cable, or your cellphone) could be cut or reduced?
Then, decide how you want to save your money. Do you want to save for vacations? For birthdays or holidays? For general emergencies? It’s up to you.
After that, list all of your everyday expenses. Gas, food, recreational activities, etc. go on this list.
Adjust to reality
When you balance everything out, are there any surprises? Are you surprised by how much money you spend at Buffalo Wild Wings? Would you rather put that money you spend on movie tickets towards a savings account?
If you decide that you would rather move around your finances, then do so. It’s your money and it’s up to you. At the same time, maybe it makes total sense to you to put a few dollars per week toward buffalo wings instead of making an investment of some sort.
That’s okay if that’s where you are in your life. Just be sure that you know what you do with your money. And if you’re not happy with your money’s destination, then change it for your next paycheck. Take control of your financial life using budgets. Customize yours so that it meets your needs and wants, and so that it makes sense to you. After all, it’s your budget.