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Budget Spending

Why does everyone associate budgeting with saving?  Saving is necessary, but it isn’t sexy.  In fact, saving is boring and feels like a punishment to most people.  It is time to redefine budgeting and realize that it is a tool that allows you to do the following three things:

  1. Take advantage of opportunity
  2. Spend more on the things that matter
  3. Save
Budgeting

The Benefits

1. Opportunity (3 Months, then release!)

Without a budget, most people spend as much or more than they make leaving little to take advantage of opportunities.  Even worse is when someone just views budgeting as a way to save and, as a result, is paralyzed from spending because the only goal was to save.

The main goal of budgeting is to improve your life now while planning for the future.

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That is why you should use budgeting as a tool to put yourself in a position to take advantage of opportunities as they come.  Stash some cash away in savings until you have a minimum of three months living expenses.  After you have enough to live on, the rest of your savings will be your opportunity fund.  These funds should be used to learn a new skill, start a new business, or do something else that will move you forward.

What should I use these funds for?  If you can answer this question with “YES!”, then you are using the opportunity fund correctly:

By spending this money, am I moving myself forward towards my goal without hurting myself or my family?

2. Quality Spending

Budget so you can spend!  Sounds counter intuitive, but it makes perfect sense once you break it down.  Budgeting allows you to monitor all of your income and expenses.  This means that you know where your money is going.  By cutting the pointless spending that adds little to no value to your life, you have more to spend on other things.

Improve your life by increasing spending on things that will benefit you long term or provide satisfaction longer!   

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When you budget to spend your money on something specific (experience or material good), it takes the guilt out of the purchase.  Budgeting for the purchase means that you have already thought about the impact of the transaction on your finances and happiness to determine it was a good move.

* Note: Most things that improve your life long term or provide increased satisfaction are not material goods!  Buying a desired product may feel good at the moment, but once you get used to the purchase your satisfaction level goes back down to the same as before.  Experiences improve your life and help you grow as a person.  Simply put, invest in experiences.

3. Saving Money

Yes, I know….  I said savings was boring, but it is still an important benefit of using a budget.  Although it isn’t sexy, budgeting is the way you put yourself in a position to take advantage of opportunity and spend on experiences that will improve your life.

Budgeting Life Rollercoaster
Imagine being on a roller coaster when it breaks down at the crest of the hill.  You are required to get of the ride and make your way down the hill.  Would you rather take 10 minutes to put on a safety harness and attach to the railing OR would you feel comfortable jumping off and running down the tracks?  The budget is your safety harness and railing.  It turns a stressful situation of losing your job or having a medical emergency into one that feels a bit more secure.  Even if you fall, it will prevent you from becoming a story on the evening news.

Take Action Today

Start a budget and figure out what you are overspending on.  After categorizing a months worth of expense you will clearly see what you are wasting money on.  Then reallocate those funds to something that will improve your life!  If you need more information on budgeting and to see how to use a simple budget tool, visit these pages for more!

Budgeting Overview with VIDEO: http://mydailymark.com/budget/

Budgeting Detail with 2 VIDEOS: http://mydailymark.com/budgetdetail/

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