You may be wondering, why is budgeting important?
Budgeting is one of the biggest keys to not only managing your money, but making it work for you!
Many people are often turned off simply hearing the word budget and will give themselves reason after reason why they don’t need to budget their money.
Let’s talk about the top five lies you need to stop telling yourself and overcome to start winning with your money. The real reasons why budgeting is important!
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Table of Contents
Budget Planning 101
“I’m too busy to budget.”
If you have income and expenses then starting a budget needs to be a priority.
Your money is going to leave your account one way or another. It’s 100% better for you to be dictating those terms than just throwing money into the wind and hoping for the best!
Why Budgeting is Important: There is no too busy to budget.
If you don’t like the word budget, that’s cool (me either!), try a spending plan. Either way, if you want to take a vacation, get your hurdid, retire at some point, send your kids to summer camp, be able to afford a new(ish) car… you’re gonna need to get deliberate with your money.
If you are on the struggle bus, check out the Managing Your Money workbook. It’s a great workbook to walk you through your your money and get your finances organized.
Prioritizing your money
“Budgeting is too restrictive.”
You know what’s restrictive? Being broke is restrictive.
Why Budgeting is Important: Making a plan for your money should make you confident in your spending. Give you a plan for your financial future. Give you a clear idea of what you should be doing to make sure you get to prioritize your goals.
If you are constantly blowing your budget, a budget will help you take a hard look at your spending habits and show you where you need to make corrections to make reaching your goals possible!
Budgeting doesn’t have to be complicated. It doesn’t have to be super “mathy”, you don’t need to be a “finance person”. You just need a realistic plan.
You got this, Mama!
Tracking Your Spending
“I Don’t Need to Track My Spending.”
Uh, yeah you do.
Why Budgeting is Important: If you aren’t tracking where your money is going how do you know if you are staying on budget? How do you know how much money you have left to spend? How do you know you aren’t spending money you need to cover your rent, or your utilities or medical insurance?
Caveat: I have a system that I created for my Dollars that Make Sense workbook budgeters where I have a checking account for all my bills and another checking account for my discretionary spending. Inside my discretionary spending account, I transfer a weeks worth of money at a time. Let me tell you, it’s REEEAAALLL hard to go too far off the rails of your budget when you only have a week’s worth of money at a time. And I don’t need to worry a ton about it because I transfer all the money I need to cover my bills, savings, debt etc. into the other checking account.
Does that mean, I can set it and forget it– to a much smaller extent, yes-ish. But I like knowing where my money’s going so I still stage-5-clinger-style check my bank account and utilize checklists. But that’s me. You need to work, what works for you.
Personal Finance savings goals
“I Will Budget for that Later.”
This is one of the top reasons I see people either going into debt or taking on more debt.
Why Budgeting is Important: You know what happens when you keep pushing to “later”, it shows up sooner than you think and you are ill prepared. Don’t do that to yourself. What an absolute stressfest!
Irregular Expenses, sinking funds, emergency fund, and other long term goals etc. It’s not enough to create a monthly spending plan. You need to know what other expenses you have coming: property taxes, car registration
Sinking funds: Back to school shopping, car repairs, saving for a new car, birthdays, holidays, etc.
Emergency Fund: Stuff. Happens. 100%
There is no time like the present to start planning and getting ahead.
“Budgeting is boring.”
OK, so it’s not as much fun as going on a trip BUT…
Why Budgeting is Important: Budgeting is far from boring though! I’m an absolute spreadsheet nerd and I embrace it. Nothing makes me happier than making a plan and working that plan and seeing the fruits of my labor.
You know what’s fun? Taking a trip that you saved for and not having to worry about how you are going to pay for it, or whether you should be scrimping on food so you aren’t digging yourself further into debt.
You know what’s awesome? Showing up to the Orthodontist with the money already there to pay for my daughter’s braces.
It’s peace of mind. It’s relief. It’s freedom.
Budgeting is simply the plan you make for your money. Whether your financial goal includes plans to build wealth, save money, cut back on credit card or debt payments– financial planning (creating a budget) is key!
I’d love to hear from you. drop a comment below and let me know what part of budgeting you struggle with.