3 Missteps to Avoid if You Want to Get the Most Out of Your Personal BudgetMay 26, 2021
What are the areas of money management that confuse you?
Maintaining a budget is one of the most helpful things you can do to secure your financial future. However, that doesn’t change the fact that budgeting involves work. And if this work isn’t done efficiently, it could end up causing some costly problems. Business Expert Miriam Caldwell advises that “Many people give up on budgeting and return to negative spending habits if they can't make their budget work, or stick to it… Fortunately, a budget is a living document, so it's never too late to fix it or make it work for you.”
Here are a few common mistakes that make people give up on budgeting:
1) Being too Thorough
The majority of conventional advice about budgeting recommends that people keep close track of their finances. To the point of analyzing financial activities one transaction after the other. While this is necessary for official businesses, it isn’t necessarily practical for constructing personal budgets. Instead of using a granular approach, it’s perfectly acceptable to design a system which provides a close enough approximation. At the very least, you should keep track of major expenses so that you can understand your cost of living.
2) Using Labor-Intensive Analysis
When keeping track of expenses, it’s very important to avoid the tech-trap. Some technologies make work easier, whereas others actually make people jump through hoops. Not all technology is created equal. Before adopting a system for your budgeting, do some research to figure out whether you can overcome the learning curve quickly. There are plenty of tutorials online to help with comparisons. At the end of the day, use technology which is secure and compatible with the devices you own.
3) Using Cash Transactions
Cash transactions are a nightmare for budgeting because they can happen without any documentation. If you want to avoid spending energy on record-keeping, it’s best to conduct the bulk of your spending through debit or credit cards. Bank-cards are suitable because they generate detailed monthly statements, and they archive financial activity with precision. Moreover, going paperless with spending is more hygienic because it minimizes physical contact with legal tender.
Budgeting is not a perfect science. It’s more of a flexible art form. If you’re willing to put effort into keeping track of your finances, don’t lose sight of the fact that budgeting is supposed to make life easier. If the physical act of budgeting feels tedious and draining, there’s nothing wrong with making a few adjustments to save time. All you need is to focus on the bigger picture, save as much time as you can on admin, and go paperless. If you like what you just read from our blog, you’ll love the various informative courses, workshops and events listed on our websites and social media. Whether you’re interested in personal development, or overall improvement of your business, give us a call at 1 (888) 823-7757 to find out how The RISE Academy can help you break past your daily struggles and start soaring in success. For business development coaching by Richard Martinez, call at 626-202-2291 or follow us on Facebook and Instagram.
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