You Need a Budget – Part 2

Whether you have a lot or a little, you need a budget!

This week we’re focusing on the benefits of a budget. We’re learning from my friend Steve Brooks at DedicatedMoneyManagement.com. Steve wants his clients to become “budgeters,” not “accountants.” Budgeters check category balances throughout the month before making purchases. They verify that money is set aside for that purchase. He suggests that clients find a budgeting tool that works for them. Some use cash envelopes, others pencil and paper, or an Excel spreadsheet, or a computer program like Quicken or QuickBooks. Others prefer a budget app that they can access on a cell phone. He likes You Need a Budget (YNAB), Mint, Every Dollar, or Calendar Budget.

If someone can’t live on a budget because income is too low, Steve says they have several options. First, study every spending category in your budget. Ask yourself, “Can this category be eliminated or lowered? Is it even necessary?” Second, sell stuff that you don’t need or want. Then, use the income to fund shortfalls or improve savings. For example, if you sell an item for $500, you could begin funding your next vacation. Finally, consider starting a side business or working part-time to earn additional income. Steve has clients who’ve become Uber Eats drivers just to fix holes in their budgets. So, find a budgeting tool that works for you then develop the habit of checking your balances before spending. Thanks for the tips, Steve!

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