Budget is the four-letter word of the personal finance world. We all know we should be tracking our spending. how many people actually do it?
We know there are probably places we could save, expenses we could cut, but we’re afraid to look because then we’d have to follow through.
The key to sticking to your budget is knowing how much you want to spend in advance. That way you can work backwards from your desired monthly or weekly budget.
The crucial thing is to keep enough money aside so that if you were to face a difficult or uncertain situation, you would have the means to deal with it.
One of the biggest financial problems many people face is that they just don’t know where their money is going. They have enough to pay the bills and maybe the family has a few weekly traditions eating out.
There are two problems with budgets that make them completely unworkable for most people. First, we have no idea how much we should be spending. The second problem is that 99% of budgets are so far off that failure is guaranteed.
With this initial look at your budget, you can attack the three financial problems: 1. You know exactly where your money is going 2. You’ll find places to save money