The Power of a Budget
I was chatting with one of my Money Masters yesterday about a purchase she wanted to make.
She did not have enough in either her education or play accounts to cover the cost (this purchase was very educational and well, play money can be used for anything).
But, she really wanted it.
Now, she is an adult and can do whatever she wants, but she also knows that sticking to a budget is how she was able to pay off her car loan, credit card debt, will be graduating this Saturday (congratulations!!!) with no student loans, can easily afford her horse/pets/travel, and is saving for her first house.
I am not sure what her final decision was, but I think she was leaning toward holding off on the purchase until she had the money in those accounts.
This is why it is so important to budget.
By knowing exactly where everything is going and allocating funds to those five important buckets- savings, investing (future you), education, play, and giving/tithing- it makes it so much easier to make decisions.
And starting is not that difficult.
Write down all the money you expect to come in for the month.
Write down all the money you expect to go out for the month.
Assign the expenses to each time you expect money to come in (weekly, bi-weekly, semi-monthly, or monthly).
If there is more going out that coming in you either need to increase your income or decrease your expenses.
The magic happens when you do both!
