I’ve mentioned the value of budgeting a few times here in this site and I can personally testify that living on a budget has allowed me to pay off thousands of dollars in debt. People often get frustrated with their budgets just because they don’t fully understand them and the discipline it takes to live on one. Here are a few dos and don’ts of finding your financial freedom by living on a budget.
Plan your budget together – Many marriages end over financial disagreements. Budgets require discipline and planning. If you fail to work as a team, with your spouse, then it literally could turn into a nightmare.
Define your financial goals – Are you looking to get out of debt or build wealth? Being debt free is the key to being wealthy so if you have any debt budget to take care of it first. Should you already be debt free, know that I’m jealous, plan to build up your wealth. If your goals aren’t clearly defined you’ll never reach them.
Don’t rush into a budget before you know how much you now spend for what – Know your spending patterns and habits are before you start allocating money for specific budget line items. For budgets to be successful they have to be carefully planned.
Do not think up countless budget headings – Budget for entertainment but don’t put subcategories with it. When planning out your budget don’t think of all the things that you could spend money on and focus on the things you need to spend money on.
Divvy up your dollars according to your family’s needs and wants – It should go without saying that needs come before wants. Take care of financially securing your needs first before budgeting for your wants.
Think first! When allocating, trimming, or adjusting budget amounts, do not jump to conclusions – Only make informed decisions when making adjustments to your budget. Guessing will only throw you off of your budget and put you behind.
Take all credit cards – except one for emergencies – out of your wallet – Credit cards will lead you further into debt! Keep only one and use it only if there is an emergency. If you have multiple credit card balances then budget to pay off the lowest one and then work your way up from there.
Plan for big expenses – You have to understand that financing expensive purchases adds to your debt and must be absorbed into your budget. Set financial goals and reach them before taking on any new debt and save up to make a sizeable down payment.
Do not cheat your budget – If you do it once it will become easier to do it again and again. Remember budgeting requires discipline but the payoff of financial freedom is worth it.
Don’t carry around too much cash because you will tend to spend it – You can’t save or allocate your money if you are carrying it in your pockets.
Plan your budget together – Many marriages end over financial disagreements. Budgets require discipline and planning. If you fail to work as a team, with your spouse, then it literally could turn into a nightmare.
Define your financial goals – Are you looking to get out of debt or build wealth? Being debt free is the key to being wealthy so if you have any debt budget to take care of it first. Should you already be debt free, know that I’m jealous, plan to build up your wealth. If your goals aren’t clearly defined you’ll never reach them.
Don’t rush into a budget before you know how much you now spend for what – Know your spending patterns and habits are before you start allocating money for specific budget line items. For budgets to be successful they have to be carefully planned.
Do not think up countless budget headings – Budget for entertainment but don’t put subcategories with it. When planning out your budget don’t think of all the things that you could spend money on and focus on the things you need to spend money on.
Divvy up your dollars according to your family’s needs and wants – It should go without saying that needs come before wants. Take care of financially securing your needs first before budgeting for your wants.
Think first! When allocating, trimming, or adjusting budget amounts, do not jump to conclusions – Only make informed decisions when making adjustments to your budget. Guessing will only throw you off of your budget and put you behind.
Take all credit cards – except one for emergencies – out of your wallet – Credit cards will lead you further into debt! Keep only one and use it only if there is an emergency. If you have multiple credit card balances then budget to pay off the lowest one and then work your way up from there.
Plan for big expenses – You have to understand that financing expensive purchases adds to your debt and must be absorbed into your budget. Set financial goals and reach them before taking on any new debt and save up to make a sizeable down payment.
Do not cheat your budget – If you do it once it will become easier to do it again and again. Remember budgeting requires discipline but the payoff of financial freedom is worth it.
Don’t carry around too much cash because you will tend to spend it – You can’t save or allocate your money if you are carrying it in your pockets.
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