People normally though that money is the most important thing for you to do anything you love. They thought that they can only go for a vacation if they have a bunch of money. They should go back as soon as possible to start coming to work, back to a normal life and jump into making money. Well, what a boring life is!
The matter is people do not know on how to create a simple budget where we can balance all costs. People just found that it takes a ton of time, it gonna makes us exhausted to think lots of problems. However, people don’t know how to make it easy, and when we can standardize it, things will be run automatically and professionally.
So let’s jump into 4 steps to create a simple budget:
- Start the audit
Realize who they are, how they spend their money right now? You budget for a person that you are/ you want to be.
People feel discouraged when doing the budget for a people that is not what they are. You will gonna say with yourselves that it does not work for you. Let’s not pretend to be someone we are not. The budget is like whippy in the shape.
So look at your budget in three months objectively in their bank statements! How do they send their money? Write down the numbers that is your starting place. If it’s over, it’s no problem. It’s just your starting place. Don’t judge whether it’s good or bad, you are on the way to evaluate and audit yourselves, your spending.
- Automate
The reason you should automate as much as possible either between bill pay or auto pay and making sure that it matches with the way you get paid. Don’t consider much about how to reduce what you spend monthly. Your monthly bills do not change much, it will automate accordingly.
Put your brain power focuses on funny things. Automate so much as possible so your budget is a system that supports you, instead of your budget would be that you’re nurturing all the time and you’re rechecking numbers.
- Set in the system of accountability
You know, there are a lot of variable things in your spending. How much you spend on food every day, how much you spend on your clothes or how much you spend on entertainment purposes. We need to figure out all activities and their respective numbers, and then we need to set up a system that does not need to be over complicated to hold you accountable.
For example, we can start with cash. Cash is the simplest thing which is the easiest accountability method for daily spending, your groceries or your protein food. How much you spend for your protein food for every pay period? And then every check, you pull out and multiple it with amount. You may need every single form for each type of spending. And at the end, we are automating it. We need to check your bank account once a week.
- We achieve it!
Now we stop thinking about all the things we want to do. We just focus on one goal at a time. Every pay period, we make progress. You do not need to do all things at a time as you will not be confident about it. You are gonna overwhelmed.
Over the time, you start getting confidence, you feel empowered and you know that you are in the driver’s seat.
A common obstacle some families may overcome is that they usually budget for a person that they don’t wana live. Budget a realistic number that you don’t want to become. A second common mistake is that they do not set up a system of accountability. They don’t have a system or they have a bunch of systems that make them confuse and turns it into messy.
Next one, let’s share your goal to your companion, your spouse or even your family members instead of just keeping for yourself. You and your spouse should own it in your community. So that’s it for four steps on how to create a simple budget and you should start it right away. Share us your result and how it gonna impacts to your monthly or even quarterly spending plan.