When asked to budget their money, we all know someone who sounds like this:
“Budgeting is no fun.”
“You have to give up everything you like.”
“I don’t get numbers.”
“It’s such a headache!”
Maybe you’ve said some of these things yourself, don’t feel too bad. It’s perfectly understandable when the majority of people have very negative associations with the word ‘budget.’
However, that doesn’t make them true!
The idea of budgets being boring is actually a myth if you are willing to see them from a different angle. In fact if it is boring, you’re doing it wrong. Today, let’s tackle this myth in its different incarnations.
#1. Budgets are boring because they cut out all your fun options.
This one is arguably the most common. The assumption is that once you start budgeting, you need to give up all the fun stuff like cutting out going to the movies, not being able to buy all your favourite comfort foods or not being able to look forward to dining at that nice restaurant with friends.
In reality, that is a very incomplete picture. Life is there to be lived and enjoyed so you don’t need to cut out all the enjoyable things. A budget, in its simplest form, is a plan. It is a plan that organises your income and expenses and helps you plan for future expenses. The aim is to create balance between what comes in and what goes out. There is a chance that certain areas of spending will have to go down a notch to create that balance but ask yourself how much fun digging yourself into a financial hole and struggling with debt by not budgeting is.
The only way you will ever find out what balance is for you is to actually sit down and take some time to outline your budget! For all you know, you could still buy your favourite snacks, watch a movie and enjoy a monthly dinner at that restaurant. The important thing is that you do your homework and you have the numbers to ensure your lifestyle keeps you debt free and happy!
#2. Budgets are rigid and life can be so unexpected sometimes.
Yes, life is an amazing ride and you never truly know what to expect. That does not mean you can’t still plan for the unexpected. What we do know for sure, is that “things” just happen that we can’t control and being wholly unprepared makes the situation worse! Spending plans aren’t one-dimensional plans that you must stick to at all costs. They are designed to change with you by preparing for both what we expect to happen and for what we anticipate could happen.
This is exactly why every good budget has a space for emergency savings as well as your everyday categories that allow you to freely spend on something important to you. You don’t have to be too specific about what your emergency fund will be for but knowing you have a pot of money set aside ‘just in case’ provides you an added sense of security.
Whether it’s a blown car tyre or your friends suddenly inviting you to their overseas wedding, your budget will be there to support you along the way. Remember the plan you create today may not suit you in 12 months time. It can always be adjusted to suit your changed circumstances. There is no law that says you have to stick to the first budget forever.
#3. Budgets requires too much maths and I’m no good with numbers
You don’t need to be a mathematics genius to create a spending plan. You just need to have access to all your expenses details and when they are due then compare them to your income. There is no need to memorise every expense and run numbers in your head! (As a matter of fact, our specialised budgeting program does all the calculating for you)
That said, one should never underestimate the surprising possibilities that budget options open. Most people presume that just because an alternative is cheaper, it must mean it is of lower quality.
It is not quite as cut-and-dry as that. Take cooking your own food for example. It is generally less expensive to make your own meals instead of eating out. And not only that, it is a wonderful opportunity to hone your culinary skills!
Another skill that budgeting teaches you is having a knack for value. It will teach you to look for discounts so you can make the most of your money. You can learn how to spot a real gem. These are skills that can help you save a fortune even when you already have a great deal of money!
To sum it up, there are so many incredible things you can learn and discover once you make a decision to budget. It is not as boring as it has been made out to be.
If you’d like to know more about our Spending Planner Program visit https://yourmoneyhabit.com.au/services-and-workshops/