I’ve heard time and time again how much people actually hate the process, let alone the word, budgeting. After working with hundreds of people helping them get in a better relationship with their budget, I’m convinced that most of us don’t understand the key principle or reason why you should budget.
You see, a budget isn’t about taking stuff away, but rather about providing a road map so you can actually achieve all those awesome goals that you have for your life.
A budget doesn’t have to be rigid either and you can use whatever method you prefer – an app, paper, Excel spreadsheet, a Post-it note…it’s not in the method but in the how and why.
On This Podcast Episode:
- I’m breaking down why you do this budget thing, to begin with
- How to approach your budget so you don’t feel like it’s a chore
- What you’re looking for in your budget
- How to do an easy month long experiment to empower your bank account
Take Back Your Bank Account (and budget):
- Take a piece of paper and figure out what your “have to spend” expenses are – including groceries
- Then deduct that from how much you make
- That balance, that’s what you’ve got for all the things you want to spend your $$ on plus your variable expense – the things that change for the month
- Let’s do this as a group exercise for one month weekly
- Once you get to #3, create a piece of paper for each week
- Write at the top what your bank account balance is
- Write down every time you spend money on it and put an (F) for fun or an (H) for have to spend
- At the end of the week add up all your Fun’s and your “have to spend” money on amounts in separate columns and subtract your bank balance – paying special attention to the fun’s that you spent money on that week. Do you see anything that is shocking to you? Write a note on the piece of paper
- Start again next week same process, rinse and repeat
- AT the end of the month, look back over your 4 sheets – what fun’s do you see that maybe you didn’t know you were spending your money on? Did you have more or less at the end of the month than you thought?
- What’s missing?
Thanks for Tuning In:
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The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) and financial strategies may be appropriate for you, consult your financial adviser prior to investing. There is no assurance that the techniques and strategies discussed are suitable for all investors or will yield positive outcomes.