Budget. Does the mere mention of the “b-word” evoke horror, panic, and shortness of breath? The belief that a root canal would be more fun?
You’re not alone. 77% of Americans do not have a budget. The truth is, there is nothing to be afraid of. The fear of budgeting comes from its mystery. The unknown of what is entailed and how it will affect your way of life.
Let’s clear the air.
What is a Budget?
A budget is simply a tracking mechanism for each penny you acquire. It gives you the knowledge to know how much money is coming in and how much money is going out. That’s it.
Contrary to popular belief, a budget is not something that tells you to give up your favorite hobbies or stop having fun. If used properly, a budget can help you realign your expenses and allow you to save up for the bigger things in life that you have always wanted to see or do.
The best part? It is a tool that you don’t even have to pay or apply for. Anyone can have a budget if they simply put a little time and effort into monitoring their spending habits.
You can get started with budgeting today by tracking each dollar spent, no matter how small. Do this for thirty days, and you will get a clear picture of where your money is going.
There are tools that will do this tracking for you. You could use a personal financial manager (PFM) that links right to your checking account. It will categorize your spending and tell you if you are on track or not. Alerts can be created to notify you when the spending target has been exceeded. With technology in your corner, budgeting has never been so easy.
You will likely find yourself reevaluating your spending habits and it may cause you to put an end to senseless spending. You may begin to look closer at those monthly bills to determine if you can downgrade your cable package or cell phone plan.
Alongside a budget comes dream building. In order for you to stay motivated and stick to the plan, it is helpful to focus on the end goal. Is it a dream vacation, a new car, or a new home on your list? Make that dream visible so you are constantly reminded of what you are working toward. Hang pictures on the refrigerator, at a bulletin board at work, or in your car. Take it a step further and go test drive your dream car or walk through a new home to get the feeling of what it would be like to own it.
$imleTRAX, Fortifi Bank’s personal finance manager, allows you to set up saving goals towards your dream. You can monitor your progress and feel great knowing exactly how long it will take to attain your dream.
The bottom line is we all work hard for our money, so it’s important to work hard at keeping it. If you are interested in learning more about creating an effective budget, contact a trusted professional at Fortifi Bank today.