Don’t Underestimate The Power Of Budgeting
When you know better, you do better
It might seem tedious, but budgeting is one powerful hack that will elevate your finances astronomically.
Because of budgeting, I can observe every penny in and out — even when unapproved pennies go out.
People frequently skip budgeting efforts because they:
Don’t know where to start.
Don’t know how to budget.
Don’t want to put in the effort.
Don’t want to know what they’ll find.
Some people’s financial habits are so unproductive, they’re scared to see them up close and personal.
Get uncomfortable and dig into your finances. The sooner you do this, the better off your financial situation.
When you face your finances head-on, you will experience a positive transformation.
You can’t improve your finances when you are ignorant of what’s happening.
Subscriptions Will Destroy Your Budget
Recently I cut out a ton of subscriptions and “mandatory” expenses after realizing I could do without them and wasn’t finding legitimate value in the services.
Since many subscriptions were health services, I was hesitant about canceling the subscriptions, but I had to be honest with myself and cut the cords; they weren’t providing enough benefits to maintain.
Too Much Spending Can De-Motivate Budgeting Efforts
I don’t do automated budgeting because I like to be very hands-on with my finances.
This also means I hand-input everything coming in and everything going out.
It might seem unattractive and inefficient to many, but it’s been a beneficial habit I’ve consistently integrated for decades.
If budgeting ever becomes stressful, that usually means there are too many transactions, and I can cut some spending.
The less I spend, the less time I allocate to budgeting because there are fewer transactions to track.
How To Budget
There are apps, spreadsheets, and templates you can leverage to create and maintain a budget.
In the past, apps were my favorite for budgeting, but now I’m back to the basic spreadsheets I prefer.
Track all income
Track all expenditures
Track all savings and investments
Track all giving and charitable donations
Track all cash, card, and online transactions
The best way to track is to log transactions immediately or do them in bulk on a cadence (e.g., weekly, bi-weekly).
The more you spend, the more frequently you should log so the transactions don’t pile up and overwhelm you.
The less money you spend, the less frequently you’ll need to track things, which incentivizes spending less.
Remember to Track Zelle, Apple Wallet, Google Pay, Venmo, Etc.
Many people use online payment apps to quickly deliver money to their friends, family, companies, and people they don’t know for services or other things without much awareness of how these transactions might affect their budget.
Transactions in online payment apps can easily get lost and forgotten in a budget.
Track these immediately; they can quickly add up if you’re not paying attention.
This article is for informational purposes only. It should not be considered Financial or Legal Advice. Not all information will be accurate. Consult a financial professional before making any significant financial decisions.
For the first half of this year I started budgeting manually on a spreadsheet. Last week I decided to give the You Need A Budget app a try so that I could track my spending as it was happening throughout the month instead of looking at it retroactively when the month ended and I finally decided to sit down to budget. So far its been good but it feels weird having to allocate money ahead of time. After a month or so I'll decide if I want to go back to my spreadsheet