We talk a lot about credit and great ways to access and spend your funds, but there’s one very important step we should take when it comes to our money…
…budgeting.
Does that word sounds scary or boring? It must as budgeting seems to have such a negative connotation surrounding it. Though it’s true one could live off the available credit of a credit card for a short period–charging every desire of the heart–this will eventually catch up and bite you soon enough. Slow and steady wins the race… most of the time.
So, why does budgeting seem like such a dirty word for some? Here are our top 5 reasons.
“Ain’t nobody got time for that.”
Between work, getting kids to after-school and weekend functions, taking care of daily tasks and trying to get to your own extracurricular activities, budgeting seems, well, tedious. Who wants to spend their free time deciding how much to throw in savings when you could be watching this week’s episode of The Walking Dead?
A little time spent making sure your finances are in order can really save you a lot of time in the long run. If staying out of debt sounds like a good plan, you’ll find the time to devote to budgeting.
I forgot to make budgeting a priority.
Like a physics student starting on a 20-page essay the night before it’s due, panic starts to creep in, you start looking for the coffee and energy drinks and wondering how little sleep you could get by on if you stay up all night getting it done. Then, morning comes and you sleep through class and miss your opportunity to turn it in.
Don’t miss out on great financial opportunities because you forgot to make budgeting and planning for surprises a part of your weekly routine. It takes 21 days to make or break a habit. But, you can’t succeed unless you start somewhere–so start with making a calendar entry (with a reminder) in your trusty smartphone or within your email program. Set aside the time to budget and the task won’t seem as gargantuan as the poor physics student’s.
I don’t even know where to begin.
If you’re in that boat, it’s likely because you feel a bit overwhelmed and haven’t stopped to look at not only where you’re trying to get–AKA: Point B–you’ve forgotten to take a look at what you have in front of you–Point A. ‘Point A’ usually consists of taking inventory of what your current financials look like (how much liquid cash you have available to you at the present moment) and how much of that will soon go out to cover expenses like utility bills, home and auto payments and other necessities like child care expenses and medical bills. It’s as easy as using the skills you learned in 1st grade: addition and subtraction. Write it all down and subtract what you owe from what you currently have and keep doing so as long as you earn and spend money. If you don’t know how much you have, you can’t plan to put some of that hard-earned cash into savings for a trip to the Bahamas to reward yourself for being so diligent with your recordkeeping.
It’s just too hard.
It may seem that way at first, but just as it takes 21 days to make or break that habit, it takes just as long to learn how to budget like a pro. Just be sure to PYF! What’s PYF you ask? Pay Yourself First. Before you spend cash on anything not already assigned to a bill or other expense, take a portion of it and put it in a savings account. A special savings account, like a Christmas, Vacation or other special purpose savings account at MembersFirst is one excellent way to corral excess cash while also earning dividends and keeping it separate from your checking. Make it easy on yourself by setting up an automatic deposit from you payroll check or checking account to your savings. Fast and convenient–it’s like the money was never there, making the temptation of spending it obsolete.
My goal is too big; I started too late.
If you don’t take anything away from this message, please remember one thing: It is NEVER too late to begin taking care of your financial health. It’s never too late to begin putting money away for a rainy day or a goal of any size. Using the knowledge you’ve already gained in previous paragraphs, you absolutely can reach your savings goals. If you’re looking to become completely debt-free, by all means, do it! Just be sure to make responsible spending habits for yourself. If you’d like to pay cash for a vehicle rather than finance it, it will take some time, but as you’re tracking your spending and saving habits, keep your debt-free goal in mind. Every dollar spent frivolously is another dollar taken away from reaching your goal. Just remember life isn’t all about what you’ve have in your savings account. It isn’t meant to be boring–we still have to spend money on fun and entertainment. Keep this in mind when creating your goals. If it seems there isn’t much wiggle room for the ‘fun’, maybe you should take another look at what you’ve labeled as a necessity or how much of your ‘leftover’ cash you’re throwing in savings each time you’re paid.
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Still feel completely lost on the budgeting topic? Want to talk to someone? Just give us a call at 404-978-0080 or drop by a branch and set up an appointment with one of our Member Advisors to discuss your financial goals or to have them help you get on track with spending. After all, our goal is to help you afford life. Funny how that works out!