Making 'Cents' Out of a Budget

A budget can be simple or complicated, whatever you like – but always flexible.

Flexible?!

Yes, flexible. Our lives are steadily changing, for better and for worse, and as we have to adapt, so does our money plan.

A budget is a plan, a money plan. Plans don’t always pan out. Sometime things go better than planned or just as you planned or not at all as you planned.

Whatever the situation, a budget is simply a plan, a map, that helps you stay ontrack. For instance, this month I have $100.00 allotted as my allowance. (My husband and I both have an allowance to spend on things that are just ours.) I saw this beautiful vase that would look perfect on the mantle in the living room, but it’s $252.00! So if I really want it, then I’ll save for it.

This brings me to another point. Some people will place some things in different categories. For example, when I mentioned this vase to a friend, she said ‘But that should come out of the Home Improvement account. You’re beautifying your home.’ Well, yes, but, and here’s the but – does hubby think it beautifies the home? He probably wouldn’t even notice! No, with our money plan, necessities like curtains, or new wood for a rotted out step, these things come out of the Home Improvement account. But, that’s in our house. Your budget must suit you.

Why have a budget?

Without a budget many people tend to spend what they have, i.e.: no savings. Having no savings is flirting with disaster! Its increadibly easy to fall into the keeping-up-with-the-Jonese trap. Don’t let it happen to you! I’m not trying to talk you out of having nice things. Absolutely, have nice things – but only if they make you feel good. If you’re buying that new Nissan Titan because your best buddy just bought one and is raving about it, but you have a perfectly good 2000 Chevy Silverado that has never let you down – well, is this purchase really a necessary one?

And by necessary, I’m not talking about keep-you-alive necessary. I mean its necessary to you. Allow me to illustrate: clothes are necessary – you can’t go around naked! Any clothing will do. However, well fitting, classically lined clothes that make you feel good about yourself and are appropriate to your situation are better. Perhaps not Channel suits, but nice clothes. These are necessary because they are necessary to you.

Budgeting helps you see this on paper, in black and white. When you enter a receipt into your budget sheet and subtract t hat amount from the balance, it shows you point blank, yes or no, if there is enough money for such and such.