The Bottom Line: Your personal budget is the main tool to monitor your financial activity and achieve your financial goals. A budget helps you spend your money wisely, avoid debt, pay your debt off efficiently, and build your wealth. It’s not important whether you use an old-fashioned envelope method, a spreadsheet on your computer, or the newest app. What’s crucial is that you create and maintain your personal budget.
Have you ever said...
In fact, everyone can benefit from keeping a personal budget. It isn’t just for frugal people looking to cut off a few dollars at the grocery store. A budget is your prime tool to manage your finances, control your cash flow, and build your wealth.
There are tons of reasons to keep a budget. First of all, your budget helps you track your expenses. Once you get a good handle of how you spend your money, you can more efficiently cut your expenses. Secondly, you will understand exactly how much money you put towards paying off your debt. Thirdly,it will help you bolster your savings by cutting expenses or avoiding frivolous purchases, and transfer money into savings accounts. Lastly, your budget improves your focus on what resources you have available to build your investment and retirement accounts.
For many, just the idea of creating a personal budget (and don’t forget that you have to maintain it on an ongoing basis) is way too much work.
Creating a personal budget is not effortless. However, creating a personal budget is not an overwhelming chore. It takes a little time to create, but it’s the discipline to keep your budget updated that yields the biggest returns.
You’ve heard it before. Making a budget is like...dieting… or running a marathon…or fill in the blank with anything in life that takes time and effort. It doesn’t matter to what you compare it, just make one.
When you make budgeting a habit you will reward yourself with greater insight and accuracy. You will more assuredly prepare yourself to reach your financial goals.
Today, it is easier than ever to keep a personal budget. You can choose between “old-fashioned” methods or online budget applications to track your online banking and credit accounts. Either way, you still need to make manual adjustments to track your cash expenses and income accurately.
In order to get you started on the path to creating your personal budget, divide your budget into these general categories.
Setting goals is an important part of creating a budget. It’s a motivator. Saving for a vacation, paying off your debt, putting your children through college, or any life dream, require long-term commitment and dedication.
Reviewing your budget reinforces what you’re working for and the progress you make. Reaching your goals is a challenge, but the act of budgeting gives you a game-plan and milestones to start on a path to your best financial future.
A personal budget is a powerful tool, which helps you gain your financial strength. Your budget will help you cut your expenses, pay-off your debt, save money and build your wealth. For more complete information about creating a budget, check out Bills.com Budget Guide.