Intro to Budgeting
Budgeting: An important and often overlooked aspect of personal finance.
Even the richest entities on earth have limited resources in terms of income and most have an unlimited number of expenses. The richer you are the more expensive your needs become and then on top of those there are always additional wants. Budgeting is a boring and tedious process and may be difficult to maintain, however it is very important so that you are able to effectively direct your limited resources to your highest priority expenses. Those who do not budget at all are likely to live paycheck to paycheck, never achieving long term financial goals. A budget can be as detailed or as simple a you wish. Some people wanting to know and track exactly what they spend on each category such as food, shelter, and clothing, while others just want to plan for saving x amount first then spending the remaining on needs and wants.
Living paycheck to paycheck can be psychologically brutal. It really does not matter how much you make today... if you earned twice as much tomorrow we all know that a persons expenses will quickly climb to fill the void. The only way to end this vicious cycle is to have a budget so that you are always saving part of your income for long term financial goals. It could be an emergency fund, retirement, buying your dream house, etc. The very act of sitting down planning to spend less than you earn and saving the difference will forever change your financial future and hopefully you do not find yourself still living paycheck to paycheck as your climb the income ranks.
Take time today to design a budget which allows you to live a great life today while still providing for your future self and family. A small sacrifice today will be much appreciated decades from now.
Disclosure: I wrote this article myself, and it expresses my own opinions. I have no business relationship with any company whose stock is mentioned in this article. The information provided should NOT be considered advice. The topics discussed are risky and have the potential to lose a substantial amount. I am not an investment professional and therefore do not offer individual financial advice. Please do your own research before investing.
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