Why Personal Budgeting Works Best With A Budget Planner

Why Personal Budgeting Works Best With A Budget Planner

The title of this article might seem obvious, but people often fail in keeping to a budget because they do not use a written plan. They do the things they have to do: look at their finances, add up their regular on-going costs; estimate their other costs and arrive at an amount they think they can set aside for savings. If they have used pen and paper to work this out, then they have a basis for a budget planner. But sometimes this is as far as they go. If they have not transposed those original figures into a written plan, their objectives will be harder to achieve.

A budget planner is simply a tool to help us stay on track. It tells us where our money is going and where it should be going. If we want to spend money in a certain direction our budget planner helps us to work out if and how it can be done. If we are getting behind or finding it hard to stick to our plan we can consult our planner to find out why. We should know where we are spending our money, even if it is in the wrong direction. Sometimes we will spend money we did not mean to spend but we need to know where we spent it.

A budget should not make our life a misery. It should help us by making it easier to organize our money so we can meet our regular commitments, enjoy ourselves and save for the future. A budget planner helps us do this. The simple fact is most of us do better when we can see figures written down. They have much more of an impact. By writing them down they become actual figures rather than ones floating around in our head.

Why do businesses keep records of their finances? Apart from the fact they have to keep them for the taxation authorities, it is the only way they and others know how they are going. They can see at a glance the income of the business against the cost of running the business and, therefore, what profits or losses they are making. It is no different for personal budgeting. It is important to know how much money we a spending on our lifestyle and how much we are getting to do it and whether we are in front or behind. A budget planner is the most effective tool to do this.