How can you change your mindset about budgets? When I was younger I thought we only followed a budget when we were broke. We temporarily restricted our spending until we had more money. Once we had money we no longer had the budget. But guess what? We would end up again with no money and back on the budget. The cycle continued.
This is not a budget.
A budget is a plan for how you spend your income. Following a budget has absolutely nothing to do with how much money you earn. On the contrary, it ensures you are spending your money as you wish without spending more than you have.
If you are not budgeting it is more likely that you will have high debt, lack of savings, poor credit scores, and struggle paycheck to paycheck. This can lead to other issues such as stress, anxiety, poor health, marital problems, and low self-esteem.
If you are like many who do not have a budget then you probably have some resistance to it. Below are a few common reasons people don’t have a budget and some tips for breaking that resistance.
1. I have to sacrifice if I have a budget.
Many people think a budget is about taking away all of their fun.
If you think a budget represents deprivation and sacrifice you are missing an opportunity to take control of your finances. Instead, think of a budget as a tool to help you allocate your income efficiently in order to achieve your desires. It’s all in your mindset.
2. I don’t know how to start a budget.
If you don’t have experience with budgeting it can be difficult to find a starting place. However, we all have to start somewhere, right?
Start by documenting your monthly income and expenses. Everything needs to be accounted for so list it all. Examples of expenses are rent/mortgage, groceries, gas, cell phone, utilities, car, and household items.
Once you get this information you are more than halfway there. So….you got started!
3. I feel discouraged.
It happens to all of us. You think everything is going well until you look at your actual numbers. It can be shocking to see how much you are spending on coffee, dining out, online shopping or entertainment. The good news is that you are aware of it and now you can do something about it.
If you are feeling discouraged ask yourself if your spending is lining up with your values. This is a good time to consider changes that are for your better good and possibly save some money at the same time.
I encourage you to be creative when you feel discouraged. Generally, discouragement is a sign that you need to let go of resistance and change something up.
Mindset about budget Example
Our overspending was in the dining out category. We often would go out to eat simply because I either did not know what I felt like cooking or it was just more convenient to run out and grab some food. Looking at my values, I was not completely lined up. I really do prefer to provide better meals for my family and spend more time with them. Although, I do like to go out once in a while.
We reduced the number of nights we eat out by half. I cook a little more at home which allows me to learn new recipes. Also, I cook with my kids which gives us more time together. A few nights a week, the kids cook the meal. And, we still go out several times each month.
With a family of five (3 teens) our dining out expenses was really high. By making these changes, we not only saved money in this category we spent more time together. I learned some new recipes and my kids learned some new skills. My values are more lined up so there is no feeling of deprivation. In fact, it is the opposite. I actually feel better.
4. I don’t know what budget method to use.
There are a lot of recommendations for which budget method is best. Honestly, whatever you will stick with is the best method for you. If your method helps you allocate your income to all of your expenses and you are not spending more than you have coming in, then you are in good shape and you are using a solid method.
If you are overwhelmed by the choices, don’t let this stop you. Grab a pencil and paper and write down all of the expenses you have for the coming month, add them up and subtract from your estimated monthly income and start there.
Whatever you are resisting, try to work through it. Budgeting does not need to take a long time, it only needs to be consistent.
What method do you use? What methods have you tried? Please post comments as I would love to hear what works for you and even what has not.
Some related articles about budgeting
Thanks for reading!
Stay Balanced,
Jill