Monday, January 5, 2009

Money Savvy Monday: Living on a Budget

Why do I live on a budget?
About 2 years ago, my husband and I decided that the way we were living was not working. We both worked hard and made decent money, but yet every month we were coming up short. I couldn't figure out what we were doing wrong. Then I read My Total Money Makeover by Dave Ramsey.
Oh, now I saw what was happening. Our outcome was surpassing our income!! After time, this will add up to accrued debt, that will not only cost you more in the long run, but take forever to pay off. By the time you finishing paying for what you bought, you can't even remember what you charged in the first place.
Here is what Dave has to say about budgeting:
"The dreaded "B" word. Budget. The only other word that starts with "B" that might generate a worse reaction in most people is the word bankruptcy.Unfortunately, the word budget has gotten a bum rap - it is basically just a PLAN. When you budget, you're spending on paper, on purpose, before the month begins. But many people view a budget as a straight jacket that keeps them constrained. Freedom and budget just don't seem to go together. However, when you see that a budget is just spending your money with intention, you'll actually experience more freedom than before. Many people say they've found even more money when they created a realistic budget and stuck with it. "
Here is the link to the budgeting sheets that I use.
If this doesn't work for you, find one that does. Give it 3-4 months to start working. It will not be perfect the first time you do it.
I am proud to say that in the last 2 years I have not accrued any credit card debt. We have take family vacations, done home improvements, and bought furniture, but we did it all with cash.
It will take discipline and learning to tell yourself and family NO, but in the long run you will realize that you still have all you need.
Let me know if you live on a budget and how you feel about it.


April said...

Dave Ramsey is awesome. He has daily podcast that are great, it really helps to hear other people' stories. Living on a budget is NOT easy but living without credit card debt is WONDERFUL!!

Bridgette said...

Budget Smudget. LOL! Seriously, I am learning slowly but I know we will be happier in the long run. Thanks for your help!