Attain Financial Freedom By Learning to Budget : Part 1 Why Do it?

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What is the big deal with budgeting? It seems like everyone is talking about it, but they don't always mention why it is important. Creating your first budget might sound like a lot of work, but we will walk you through it and help you understand the why and how of it. Let's start with the why.
 
WHY???
 
Creating a budget is important for several reasons. One of the biggest reasons is that creating a budget means creating a spending plan for your money. This ensures that you have money for things you need or want. By having a plan for your money, you will be much less likely to go into debt and be able to begin chipping away at your current debt. It also keeps you from spending money you don't have. It is so easy to swipe that card, but if you're not tracking what you're spending, you may end up unable to pay the bill at the end of the month. When you're tracking your spending, you're also more likely to kick those bad spending habits. What does a coffee a day add up to? It could be costing you over $1,000/year. Your daily coffee habits could be costing you an exotic trip or forcing you into debt when an emergency arises.
Having a budget will help you to know how much to put into an emergency fund and begin building that savings. This will prevent you from going into debt next time your car breaks down.  
Achieve something bigger. We mentioned money quite a bit in our goals post and the budget is the perfect way for you to work towards those goals. These goals may include paying off debt, saving for a house, vacationing, paying for college, retirement, etc. Saving large amounts of money can seem daunting. A budget helps break down that big number into big size pieces that look much more doable. By breaking this goal into monthly versus the total amount, it is much more achievable. 
Finally, having a budget will greatly reduce your stress. Yes, right away it can seem incredibly stressful, but after the first month or two it will make your life much easier. You will sleep more soundly at night knowing that you will have money to pay rent next month or that you aren't worry about how to pay for your daughter's braces. Life is stressful enough without adding money issues to the mix.


 
 
 

 
 
 

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