Budget or not?

Many people think the most important goal of managing money is to keep a budget. That's the first myth we'll discuss.

A more important goal is to spend less than you earn. Some people can do that consistently without a budget through self-control and discipline. The truth is that the budget is a very effective tool to help you spend less than you earn and manage the financial resources given to you.

Let's look at common myths and truths of budgeting:

Myth: We have tried a budget once before and it didn't work. Truth: We don't perfect new skills on the first try. Did you ride a bike on the first attempt? If you have tried budgeting previously, you are in the best position to succeed by learning from your previous experience.

Myth: Our income changes each month and, therefore, we cannot budget. Truth: More than anyone, people on a variable income should budget. Although your income changes, a budget helps you monitor expenses to not exceed your income.

Myth: It is impossible to budget for contingencies and unplanned expenses. Truth: Although you don't know exactly what will happen, you know that thing break and need repair and that some doctor visits will happen. Use an estimate.

Myth: We are not the "financial" types. Truth: You do not need math or business expertise to start a budget. Simply keep track of the money coming in and going out.

Myth: We don't earn enough income to budget. Truth: The smaller your income, the greater your need for a budget. When you budget, you limit excess spending.

Myth: We earn too much income to worry about a budget. Truth: Although you may be blessed with an above-average income, a budget can help you. As incomes rise in many families, the expenses often rise at the same or greater rate.

Myth: We don't have time to keep track of a budget. Truth: It takes far less ore time and stress to keep your finances in order than to handle a financial mess.

– By Jeremy L. White