MONEY LIE: I Can’t Budget

Welcome to the “Money Lies” series here on the wildly popular In this series, I will be sharing many common money lies that people believe.

MONEY LIE #5: I can’t budget.

This is so common. People are busy. They hate math. Their spouse is impatient about money. They have “seasonal, cyclical, or irregular income” and that makes it more difficult to budget.

Here’s the deal. I KNOW it is difficult to prepare a budget. I’ve been told that by many people. They share that it is difficult expecting that to make it okay to not prepare a spending plan. My question is this: “Difficult compared to what? Not budgeting?”

I don’t know all of the reasons that people choose not to budget (and it is a choice), but here’s one thing I will fight about: A BUDGET SET ME FREE!!!!!

  • A budget allowed me to know exactly where every single dollar was going BEFORE I was ever paid.
  • A budget provided choices to me – because I was planning it before I received it.
  • A budget brought my bride and I together and put us on the same financial page.
  • A budget allowed me to pay off all of my non-house debt in 14 months.
  • A budget allowed me to pay off my house in 10 years and 1 month.
  • A budget has allowed me to launch two businesses and purchase another.

In case you can’t tell, I am more than a little passionate about this topic. To put it all into a simple sentence: “You need a budget!”

Here are some practical ways you can make a budget work well for you:

  1. Use a budget tool.  This allows the math to be done automatically for you, and that means you can focus on the financial decisions instead of a facing a terrible math quiz. Use our FREE BUDGET TOOLS – they do all of the math for you!
  2. Build an emergency fund equal to a full month of EXPENSES.  This is EXPENSES – not INCOME! Once you’ve saved enough for an entire month of expenses, you can ignore multiple paychecks each month, and use the Monthly Budgeting Tool instead. And you will rid yourself of a level of stress you didn’t even know you were dealing with!
  3. Be realistic.  If you are just beginning to prepare a monthly budget, it is important to be very realistic on your expenses. Do not tell yourself that you will spend $2.81 on groceries in the next month. That’s not possible, and it sets you up to fail. If you have a household of kids that are involved in 83 activities, don’t put $0 in your “dining out” part of the budget.
  4. Read the “How Do I Budget SERIES”. You can read that HERE. It will really help you as you launch into the wonderful world of budgeting!

Read the entire series (available after 2/20/2013)

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