I guess I could title this one “numbers mean stuff”. I’ve been dealing with/thinking about financials… I working on setting up a business (aren’t I always?) as well as writing. At the same time my wife’s income is going up as she is taking some teaching gigs as an adjunct faculty. And, were doing conferences and conference travel. This is all good stuff, but it makes keeping all the finances in my head impractical at best.
Putting your finances on paper (or the computer…) isn’t usually a lot of fun, even for people who actually like numbers, but the benefits out-way the negatives. Money and how its handled is a significant factor in business and marriage failures, as well as being a source of insecurity for family members, workers, partners (of all sorts) and so on. Two of the biggest culprits are hiding what you’re just spending or just not wanting to (and not) facing the numbers.
Yes, I understand its not fun sometimes to put the numbers down (it can be scary and tedious!). Nobody wants to face not having the money for what they need/want and budgets can feel constraining. At the same time, having a budget is a vital step in taking control of your finances; and control of your finances can be very empowering. And I’ll let you in on a secret (and I know this from experience) the budget it’s self can be liberating if you do it right.
How? Build in some flexibility. Give yourself a small amount you know you can spend on whatever. You’ve just given yourself a little pot of money that you know you can spend without worrying about making rent. It might not be much but its there every month and you can count on it. Another way is to put some money in savings, then you know you have some wiggle room when things get scary.
By the way, this isn’t just advice for “poor people”. If you’re not just scraping by you can get that money under control and build wealth!
It’s not just about the budget either. Doing this right isn’t just about how much but also about when. I’ve known people who pawn things to make it through the month. Then they get the stuff out and pawn it again at the end of the next month. If they can break the cycle then they save money because they don’t have to pay pawn fees (this goes for late fees and overdrafts too). It may take a scrimp for a while but in the long run it’s a lot more in your pocket.
I’m not going to tell you what your budget should be or what should be in it: 1) it’s your choice and depends on your situation, and 2) I’m a stat’s guy not a finance guy. I will say that if you take control of your finances, plan, and make choices; you will make your life better. I’ve seen it. I’ve done it.
Well, till next time… it’s your life, go live it