Do You Budget?

I’ve been budgeting for well over a year now, and I’ll admit that budgeting has become a big part of my life. Prior to becoming a budgeting nerd I never believed in budgets. I didn’t want to deprive, irritate or go through the hassle of budget up keep. A year later I believe budgets are next greatest thing to sliced bread and I still don’t understand how I made it before without budgeting. I suppose I somehow made it through and accumulated a fair amount of debt along the way – probably due to not budgeting.

I proudly discuss my budgeting and how important it is to me. Despite being a religious budget-er, I still have friends who don’t understand how I can live on a budget. They don’t understand how I afford certain things in life such as playing soccer on 3 teams, travel, saving for retirement and funding my investing dreams. Most of my friends claim that they’ve tried budgeting, but felt “limited” by the budget, so they scrapped the whole budget idea.

Comments like the one above make me laugh. The only reason I’ve been able to eliminate a nice chunk of my debt, save for retirement, fund investments and still have a life is directly due to budgeting.

Some people are just very good with their money. They know how much they bring in, and spend less than they earn. People like this are very rare. Next are people like my self – the one’s that are bad with their money. I’ve always made decent money, yet I’ve managed to accumulate over $10K in debt. And that’s why I personally need to account for everything that I purchase, as well as every dollar that I save.

Budgeting is no walk in the park and any time I tried to explain budgeting to friends. In the end I came across as some budgeting preacher. Most people within my circle don’t know about this blog or my debt struggles. I don’t divulge about my debt, yet it’s hard to talk about budgeting to someone without fully explaining why I started budgeting in the first place.

I’ve tried to explain as best I could that being on a budget does not automatically mean you have to cut out every single fun thing you’ve ever done, or will do in your lifetime. It is about taking control, understanding where your money goes, and realizing what you value in life.

Budget is all about this mind frame:

Instead of “I can’t afford Item X,” it became, “I am choosing not to buy Item X.”

Before I started budgeting I spent money I didn’t have because I didn’t want to feel deprived of anything. I wanted to experience life to the max.  I always found a way to justify the purchase to myself, and bought whatever I wanted in the end. Obviously I didn’t think about the repercussions and after years of being in debt I woke up and realized the mess I had created.

Since I’ve started budgeting, I’ve cut my discretionary spending by more than half, and I felt more deprived before when I was in debt. Oddly enough it’s absolutely amazing how fast the little purchases add up.

Starting to budget is all about changing my mindset. I stopped the process of my money controlling me and fully becoming in control of my own money. Today I decide where my money goes and more importantly I’m in the drivers seat of planning for my future and still having the ability to afford everything.

So, just like the title asks, do you budget?

Eddie