Personal finance: The foundation of a healthy financial life is the budget. We are going to share a plan so that you define in advance what you will do with each of the dollars you earn monthly.
For many men and women, just hearing the word “budget” is synonymous with stress, with something very complicated, boring, or necessary only for those who have a lot of money.
We tell you that it is not true. The budget is necessary for everyone and can be as easy or difficult as you want it; In the end, it is your goals that are going to be fulfilled.
The budget is the first step to reaching any financial goal: save, get out of debt, go on a trip, etc., a plan is essential.
Here are the ten golden rules for making a budget and sticking to it:
1. Know why make a budget
Always keep in mind that your budget will help you define plans to achieve specific and concrete goals in the short and long term. If, on the other hand, you try to put your accounts in order because someone said it was a good idea, you will not have a strong enough incentive to move you to stick to your budget.
2. Be realistic
Do not make a budget so rigid that it is impossible to meet and that it is too far from your reality. Be as honest as possible with yourself, and remember that setting very ambitious and difficult goals can cause frustrations that will make you give up easily.
3. Have willpower
Be disciplined but flexible. Commit to meeting the spending level set out in your budget, but if it’s not working, don’t be afraid. Circumstances can change at any time, so it’s not about abandoning your plans but about making the necessary adjustments and starting over.
4. Do not overestimate your income
A budget should always be made, taking into account the income that is received regularly. If income is recorded that is not sure if they will receive it, pressures could be generated that would go against your economic stability.
5. Prioritize your expenses
The important thing is not to limit yourself, but to know how to manage your money well, buy the essentials, and pay your bills on time to avoid late charges and bad credit history. Prepare a list to classify expenses and thus eliminate the superfluous.
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6. Plan unexpected events
Don’t make the mistake of not having an emergency fund to deal with unforeseen events and emergencies, such as accidents, job loss, or illness. Allocate a monthly proportion of your income, even if it is small initially, and include it in your budget so that you are prepared in the event of an unfortunate or unexpected event.
7. Don’t forget occasional expenses
Include in your budget the expenses that you do sporadically, such as paying taxes every year, your children’s birthday party, or Christmas gifts. Do not forget to account for the expenses associated with purchases you make, such as deeds, titles, and transfers when you acquire your own home.
8. Write down your daily expenses
The best way to know your consumption patterns and be able to improve them is to keep track of your payments. Knowing how your money goes every day and conscientiously identifying your “spending vices” (eg, buying unnecessary clothes) will represent savings for you in the future or, at least, will not generate a deficit at the end of the month.
9. Do not mix your accounts
If you are independent, do not mix your personal accounts with those of your own business because you run the risk of easily confusing where the money comes from and ending up taking from one to put the other. Remember that if the accounts are clear, you will be able to know what the real situation of your business is and the chances that it will last and grow will be greater.
10. Talk to your family members
Take into account the wishes and needs of each member of your family, so that they feel part of the plan. If everyone understands the purpose of having a budget, they are likely to work harder to make it successful and avoid spending too much or when it is not necessary.
Remember that making your budget is very important, and controlling it even more.
