When it comes to budgeting, everyone’s lives are different. Everyone has different objectives for their lives and ideas that they are passionate about. Budgeting is not taking those desired ideas away but, instead, it’s making them more goal focused. By setting limits and goals for oneself, one will be able to see why budgeting is key to financial success. Financial success can only come upon someone if they are spending less than they are earning throughout the course of their life. Without setting up a budget first, it will be harder to save, invest, and give wisely. A budget is a map. If an individual follows this map as they track expenses, it will help keep them from going negative. If you either haven’t started yet or have had trouble creating a budget which works for you, consider these factors when starting:

1. Meet with Someone: By meeting with someone, a person allows themselves to see that they need help. Seeking help is very humbling and helps people realize that another set of eyes can see things that one set might miss. Meeting with someone like a peer coach or financial advisor, allows for effective financial guidance. The process of simply talking through passions they may have about where they wish their finances to be in the future can also be beneficial.
2. Know Your Income: How the budget is set up relies heavily upon what the income amount looks like. You can set up categories and how much you would like to spend in each, but ultimately, if those add up to more than your income, you will run into some problems.
3. Figure Out All of the Financial Responsibilities: You might think that you are tied to specific financial payments, but you have control of most expenses. Some are just easier to adjust earlier rather than later. For example, when searching for your home, you have the option to choose the final location based off of the monthly payment, as well as other factors. But, once you sign the lease or get the mortgage, it becomes more challenging and costly, but not impossible, to change ‘this piece of the pie.’  By figuring out what the various expenses are, someone will be able to set both fixed and variable expenses for their life. So, do you have to set fixed expenses first? Not necessarily. You can estimate what you would like your variable expenses to be and then make decisions on your fixed expenses, but doing it this way may require you to make decisions sooner rather than later or make changes to your fixed expenses like changing a cell phone plan, getting rid of a subscription, etc.
4. Giving and/or Tithing: 2Corinthians 9:7 states, “Each one should give what he has decided in his heart to give, not out of regret or compulsion. For God loves a cheerful giver.” While this is reversed thinking of most individuals, I would challenge you to consider how much you would like to give prior to making decisions on your other monthly expenses. If we make this decision last, it is easy to let tithing go by the wayside.
5. Saving: Saving can only be done if there is actual income to be saved. If there are too many variable and fixed expenses, then it will be very hard to save money. Money that is saved should be used for future goals and objectives that someone has. Money is a tool and should be saved with a purpose in mind.
6. Gifts: Many people give gifts throughout the year and wonder how they should plan for this in their budget. One way to plan for gifts is to plan ahead. By planning ahead, someone will then know how much they wish to spend in gifts each month or in a specific season. In order to do this, you might save money up over several months in order to spend on gifts during ‘heavier gift giving seasons’ like Christmas, or you could adjust your savings a few months prior to the ‘heavier season’ in preparation.
7. Budgeting Apps: Budgeting apps like Everydollar, Moneywise, and Mint are fantastic areas to start when figuring how to budget. These apps make tracking expenses and income very easy and quick. However, the app is only good if it is being used, so individuals will need to make sure they are actually keeping up with the budget/tracking on a regular basis.

Overall, by setting limits for oneself from one month to another, wiser financial decisions will be able to be made. If you have found this blog helpful, but would like more guidance on your budget creation, take a moment to schedule a FREE NEXUS appointment today: https://ronblueinstitute.com/schedule-an-appointment/.

Resources:

Bible Hub. n.d. https://biblehub.com/. 12 November 2021.