Creating a budget might be one of the best things you do in taking control of your finances and living a life free of the powers of money. It’s time to stop letting money control you; it’s time for you to control your money and enjoy the benefits of creating a budget.
1. Stop Living Pay Check to Pay Check
Understanding your income in relation to your fixed and variable expenditures can immediately alleviate the syndrome of living pay check to pay check. With a clear picture of your total income minus your expenditures, you can immediately identify areas in your variable expenses that need to be adjusted to keep your budget balanced in the positive.
2. Reduce and Eliminate Debt
When you have all your creditors listed on your budget, you are forced to face your financial reality. Although it may hurt at first to face the truth about your debt, seeing the progress each month, as you pay down the lower balances first, might guide you into a positive feeling about following a budget that works.
Debt has a way of keeping you prisoner. The interest rates change, and you end up paying more for items that you bought on credit, in comparison if you bought the items with cash. Using a budget to track the progress of our diminishing debt can increase the positive feelings you hold for a future free of variable debt imprisonment.
3. Increase Emergency Savings
A budget can easily help you plan for those unexpected emergencies that happen in life. Let’s face it, life would be boring without those unexpected happenings. When you remain on a budget, each month you can take your extra money and put it into a savings account. This savings will build upon itself each month, giving you that extra security in life’s unpredictable plans.
4. Financial Security
Having a budget does not mean that you will be free from expenditures. There are certain items that must be paid each month, such as electricity, water, heat, rent, mortgage, phone, etc. There will never be a budget that does not have expenditures. The key is to slowly regulate those expenditures to just the necessities, decrease unnecessary debt, and live in a state of financial security.
Financial security means that you have a working budget that adjusts to each month’s circumstances, within the guidelines set in your initial budget. It means that you are able to live within your means and still enjoy life without being a slave to the corporate world of credit cards.
5. Save for the Future
The future can only be bright by following a budget. Before you know it, you will have your emergency fund saved, which is commonly six months of your regular gross salary. After you have achieved that goal, saving for the future begins. Whether you want to travel the world, drive cross-country, or take a vacation to your dream destination – you can make it happen when following a simple budget and living within your means.
There will come a time when you will be done working and will want to live a life enjoying the simple pleasures, such as visiting places that you only dreamed of. This is where a budget can help you realize that dream. Each penny saved is an additional penny for the future. It may be hard to see at the present moment, but the future comes quickly, so be prepared.
The Bottom Line
Following a budget has more benefits than downfalls. It allows you the freedom to live and truly enjoy the life you were meant to live. So don’t delay: create your budget and start seeing the benefits role into your life.
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