Budgeting

We believe budgeting is one of the most basic and effective tools for debt management.  Most people avoid budgeting because it is viewed as hard work or very restricting.  Many believe budgeting suggests that you have to give up everything and stop yourself from enjoying or spending anything.

What budgeting actually does is clearly show you how you spend your money and presents you with a map that is based on your financial limitations.  It will save you from overspending and keep you from being in debt if followed and managed closely. Budgeting is the cornerstone for knowing what amount of income is coming in and what amount should be going out for debts or saved. We will show you how to budget effectively.

BENEFITS OF EFFECTIVE BUDGETING
1. Allows you to manage your money – A budget is a plan for being aware about the way you spend and save your money.  A proper budget allows you to control your money/spending so your money/spending does not control you.  Budgeting relieves the stress of not knowing what you may have at any given moment.  It also helps you decide if you want to sacrifice short term spending in exchange for a long term benefit like a home, car, education or target savings.

2.  Help you maintain your goals –  Most people on budgets avoid spending unnecessarily, especially if it does not contribute to reaching their financial goals.  If you are working with a limited income, budgeting makes it easier to deter over spending.

3.  Keeps track of your money– Effective budgeting makes it clear what you have and what you don’t. It shows what’s coming in and what’s going out at all times. Proper budgeting saves you from guessing every month where your money went.  A budget enables you to know what you can afford, allows you to take advantage of buying and investing opportunities and enables you to plan to lower your debt. Budgeting allows you to prioritize your financial needs and see how far you are from your goals.

4. Manage spending and savings – By allocating your money into categories of expenses and savings, your budget makes you aware which category is priority and what expenses takes what portion of your income.  This allows you to always make adjustments or goals, based on any changes. This is significantly important when deciding how much to save during any period.  Budgets also help keep better records and receipts that are crucial during tax season or an unforeseen audit.

5. Helps your relationship and communication with your spouse about money and common goals –Discussing finances with a mate or spouse may not always be the easiest thing. A budget enables teamwork between all parties working towards common financial goals and prevents conflicts on how much money is being used. Each partner understands their role of accountability and the budget alleviates the pressure of anyone not being included or aware of finances. Team work makes the dream work.

 Budgeting Resources

• Personal Capital
• Every Dollar
• Pocket Guard
• YNAB - You Need A Budget
• GoodBudget