Many people think that budgeting is boring especially if you don’t enjoy math. I wouldn’t say that I enjoy math but I really love when it works in my favour. I think that Budgets are misunderstood. Budgets unlock the gateway to behavioural success with your finances! Once you master your budget, you become the Master over your money instead of vice versa! Also, money is the tangible expression of what you truly value and what’s in your heart. Budgeting helps you express your values and brings you joy through intentional giving. Here are four reasons why budgeting can transform your life and relationships:
1. Financial impact:
You have to budget to win, just like you need to put gas in the car to drive it. It doesn’t matter how much income you have, if you don’t plan and budget, that money can slip through your fingers so easily. It can easily become “death by a thousand cuts” which means every minute dollar or two dollar purchase here and there, can add up to more than your total monthly income. How many of us have heard of celebrities that have gone broke? How is that even possible when they are millionaires? We all know that it comes down to how you manage your finances. Budgeting has a huge impact on every financial situation, whether you have a large or small income. For example, even if you have a small income, by creating a basic necessities budget ahead of time, you can determine if you will need more money. Once you are aware of your cash shortage, then you need to come up with another income source either by working or selling something to make up for that shortfall, instead of being surprised at the end of the month and going into debt. Budgeting creates the path to allow financial success to happen.
2. Emotional impact:
Do you ever feel better when your house is clean and organized because it gives you a sense of relaxation instead of panic? I remember as a kid, when my mom would freak out if the kitchen wasn’t clean before we went to bed and I always wondered why. Now that I'm the adult, I know why. It’s the most wonderful feeling to wake up to a clean kitchen in the morning instead of waking up to a mess. It really messes up your day and starts it off on the wrong foot, when the kitchen is a disaster. You don’t even know where to start your day. Do I make breakfast first or do I start cleaning or do I just go back to bed? That’s how it feels to go month after month without a budget or a plan, you wake up feeling defeated every morning without a plan and without being organized. This takes a toll on your emotional health. You don’t build a house without a blueprint so why would you build your financial future over the next 50 years without a plan? Why is it that we spend more time planning a week long vacation trip than we do the rest of our financial future? You also experience more peace when you have a plan. Instead of feeling the stress of the unknown and holding your breath at the end of every month and hoping everything will just work out, you can breathe easy! When you have a plan to follow, this gives you a sense of hope, peace and purpose to go to work and a reason to be frugal when you make a purchase.
3. Relational Impact:
I’ve said it before but I'm gonna say it again! Communication between a couple is necessary for relational harmony and financial success. This includes communicating about your finances and the plans to be on the same road in order to get to that same destination. Relationships are like budgets, we can’t get sloppy if we want to continue to have success. The honeymoon period doesn't end...it takes daily hard work. We can’t take it for granted that things will always work out. It does get easier over time as you learn good communication habits and learn how to adapt to different circumstances in life together. When couples get in the habit of working together on their finances, it's not just their finances that benefit, but their relationship will improve as well because they are inadvertently communicating about everything else in their life more often. When communication improves and there is minimal financial stress on a relationship, the relationship can really blossom and become more fun!
I've saved the best for last...
4. Spiritual Impact:
Unfortunately, when you are living paycheque to paycheque and you think that you are broke, you can’t focus on generosity because you are too concerned about losing your basic necessities. In comparison, when you have extra money at the end of your budget and you intentionally decide to be generous and give of your time, money and talents, something happens to your soul. You have the acute realization that there is more than just you and your wants and needs. This is not natural, at least for me. I think my instinct is to hoard and keep, in case I can never find that perfect item again or because of my rationalization that I deserve that item. That I’ve really earned it because of all my hard work compared to the rest of the people in the world.
I recently got to experience this generosity of spirit first hand in a village in Papua New Guinea from people who literally had nothing except their basic necessities and yet they gave me food and made me a bracelet. My heart was so touched, that I almost started immediately sobbing. I was in Papua New Guinea for the sole purpose of helping these wonderful people, with only the expectation of maybe a "thank you," so when they gave me these precious gifts, it was the most beautiful blessing EVER! When you are able to give without expectation or without judgement, this is how you truly know what you value and where your heart is. The Bible talks about "Wherever your treasure is there the desires of your heart will also be." (Matthew 6:21 NLT) Our budget includes giving to our local church and to sponsor kids because it reminds us every month that this money is not our own to hoard but instead, it is to be wise and generous with. It is not up to me to judge those that I give to. If I can give without judgement that also changes my heart. When I start thinking negatively and judging every spending mistake and poor choice that people have made and determining whether they deserve the money that I could give them, that defeats the purpose. That turns me into thinking that I’m God, when clearly I am not. I've had so many blessings in my life that I truly don’t deserve compared to anyone else in the world. Instead, it means that I have that much more responsibility to give to those in need. It’s OK to want and enjoy nice things, that’s the definition of Frugality, but not to the point of obsessing over what I want to buy or purchase next. It’s all about balance. It’s very easy to get distracted from the main things in life because we are constantly bombarded by all this advertising and marketing and images surrounding us. You don’t have to give to your local church or sponsor kids. Find whatever charitable organization makes your heart beat a little faster and donate from your heart. What kind of generosity warms your soul? Who says that giving can’t be fun. Spend a day doing random acts of kindness and generosity and see what kind of joy that brings your soul.
Remember, you need to Budget on paper (or use an app) on purpose. This took a long time for me to perfect and sometimes I’m still not organized. I didn’t actually budget on purpose until 2014 and WOW did I ever notice a difference after that! Don't ever feel like you’re not going to have fun or freedom with a budget. I have thoroughly enjoyed life to the fullest while staying within my budget. I’ve budgeted for someone to clean my home twice a month for a year and budgeted and paid for two trips to Mexico with my husband since 2014! So it’s not like we sit around and don’t have fun! Make your budget work for you!