Why You Need A Written Budget (Even If You Can Afford It)

A budget can help someone be efficient with their money and be confident with their purchases. It will help them know that they can truly afford it and prepare for more considerable expenses.

I can safely say I make a decent income. However, I still wasn’t wise with my money. Instead, I was overconfident with my purchases. 

There would be months when I would have to wait for my next paycheck to backpay the expenses I incurred on a family trip. Or, I would have to deplete my family’s savings to pay for annual expenses, such as life insurance policies.

Although I could technically afford it, I carried an uneasy feeling about my finances. I was guessing our money and potentially hurting mine and my family’s future.

That is why everyone needs a written budget regardless of their income.

Why Do Budgets Fail?

I applaud those who want to take control of their finances and start budgeting. However, it’s essential to manage expectations.

Imagine a person who wants to prepare for a marathon. On Day 1, a new runner doesn’t begin by jogging for 30 minutes straight! Instead, a new runner paces themselves and slowly builds up their stamina.

With budgeting, it’s also essential to set realistic expectations. 

There should be a limit on how much a person spends in a particular category. However, when starting, the budget shouldn’t be too restrictive. When a budget feels too restrictive, a person will feel more discouraged than motivated.

Another reason why budgets fail is that some people forget to take into account unexpected or irregular expenses. A person may budget for their daily needs. An unexpected can wipe it all out, such as losing a job or a car breaking down.

Therefore, it’s also important to budget for an emergency fund. I recommend at least building a cash reserve worth three to six months of monthly expenses.

Budgeting is about having a plan for your money, whether for bills, traveling, or saving. To put it into perspective, before I identified where I SPENT my money versus where I PLANNED to spend money.

If I were to slip up, I would have been in big trouble. Personally, I’ve found success with a zero-based budget! 

It has made me confident about my finances for the future. I’m no longer waiting on my next paycheck to pay back my credit cards. Instead, I’m aware of my limitations and know that I can achieve my goals!

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