Do you really need a budget? Isn’t that just a boring list of numbers that means you never get to spend money on what you want?
A budget is a way to take control of your finances. It does not mean you can never spend your money on what you want. It just means you spend your money smarter. In fact, if you are always denying yourself and never buying anything you want for fear you can’t afford it, a budget could be liberating. Knowing the real numbers and finances can be a lot less stressful then trying to guess what money is where.
So how do you know if you need a family budget? Here are some tips to help you know if you need to form a budget.
Your credit cards are never paid off.
Have you ever heard the phrase robbing Peter to pay Paul? That’s what it means if you are using one card to pay another or leaving one bill to ensure another is paid. If you are paying only the minimum balance on your credit card, and/or using one credit card to pay off another, then it’s time to work out a budget to get out of that hole. Always having credit card debt is a sure sign that a budget may be needed.
Money Never Lasts.
Do you feel like you have money for a moment or two, then it’s gone? This could mean you have too many expenses, or that you are too quick to spend on wants rather than needs. If you get paid on Friday and your account is low by Monday it may be time to think about a budget.
You don’t put any money or a set amount into your savings
Having a savings plan is an important aspect of financial management. If you don’t have any regimented plan for putting money into savings then your savings will tend to dwindle as you keep spending on things you want. If you do not have a consistent plan that you stick to for savings a budget may be a good idea.
You don’t have a savings account at all.
If you don’t have any savings or emergency fund, it may be a sign that you need a budget. A good family budget can help you make savings a priority.
You can’t afford things
Do friends ask you to go out to lunch, or to an event, and you say you “can’t afford it” all the time? This may be true, or it may not be; forming a budget will help you know what you really can and can’t afford.
You never seem to have enough.
Money can be deceptive – what seems like “plenty” can suddenly be not enough. Forming a budget can help you get a grip on what you really have. You may be pleasantly surprised that you do actually have enough. You may also realize that it’s feasible for you to make some strategic cuts so that you will have enough.