I recently read an article that stated you should eventually outgrow your budget. One day you should have everything figured out, know what tomorrow brings, and plan accordingly. That is completely unrealistic! Of course, I am being dramatic, but the article made my blood curl. Here is why… A budget is simply a plan for your money. From month to month you must sit down and decide how your money will be spent before it reaches your hands. That keeps you in the driver’s seat and in control of your spending. Each month of the year is different and requires changes to your plan. If something during the month takes you off course then you know how to adjust and get back on course with a plan. It doesn’t need to be over complicated but a written game plan for your money will help you get to your goals faster than if you didn’t use one at all.
There were some good points in the article, but overall I just disagree with the notion that one day I won’t need one. Yes, I am a nerd, but writing everything down helped me get free of nearly $100k in debt and for that I am extremely grateful. You will always need a written game plan for your money in some form to stay on target. But here are some ways you can tell you are really good at it or may be able to simplify your budgeting approach:
- Your income is fixed.
- Living within your means is second nature.
- You keep track and are aware of your spending.
- You have no debt.
- You have a habit of saving and/or a large emergency fund.
- You monitor your bank balances regularly.
- You utilize a check register in some form.
- You are saving for your future.
- You are reaching your personal financial goals.
Jeff Yeager, author of “The Cheapskate Next Door” states “A diet that really works becomes a lifestyle change.” While I completely agree with this statement I also believe that lifestyle change still includes a written (even if it is very simple) plan. I personally plan to budget for life. Yes, I’ll say it again… I am a nerd. But, even when I have lots of money in the bank, a plan will keep me accountable for my actions, locate my spiritual condition, and ensure I won’t return to where I was. Will you join me?