Creating accountability is important if you’re trying to accomplish any task or goal. Personal finance is no different. One of the biggest reason people struggle with their finances is they fail to set aside a time to think and plan how they want to spend their money. Perhaps the easiest and simplest way to create financial accountability is to work with a budget. A budget is like a map, it helps you plan an appropriate route to reach your financial goals.
While there are many benefits to working with a budget, I want to highlight my top 3 reasons why you should use a budget.
- Creates Accountability- You have to first hold yourself accountable if you plan to be successful. Everything starts with you and it’s important you ensure you’re doing all the right things to put yourself in a successful position before you look at other areas.
- It helps create good financial habits– When you work with a budget you form good habits. You learn to work within a restricted income level. One day, you will not be able to work as much as you do today, therefore, learning to work within a budget will help you both in the short term as well as in the long term.
- Enables you to plan– A lot of us just work in our head. The problem with tracking things in you’re head is its far too easy to avoid accountability since nothing is documented. When you create a budget, you want to identify what’s important to you today and also think of what might be important for you tomorrow. Spend money on things that improve or add to the quality of your life and avoid over spending on things that do not improve the quality of your life.
Now, I could spend the next couple of sentences coming up with several more reason as to why you should use a budget but I’m going to opt for the more direct approach. Failing to create a budget is just idiotic to be blunt. Apple is one of the most successful company in the world with some of the smartest people working for them and they have an operating budget. I will say it again; not working with a budget is idiotic. And since you’re not an idiot, I’ve included a link for you to download a free excel budget template. Alternatively, you can simply customize any budget template that comes with your version of Microsoft Excel. Happy budgeting!