One of the really important things that I always stress to my clients is that living to a spending plan sets you up for success in life.
Knowing what you’re spending your money on is not just being responsible, it’s being respectful of the fact that you’ve worked hard to earn that money.
Tracking where your money is going, knowing what it costs you to live, understanding and planning for the months that may be a little tight, and saving for extravagances, all are signs that you’re managing your money well.
A lot of people think that a budget is restrictive and the financial version of the fun police. But it’s not.
It’s just a plan. And when that plan is well designed, then executed and revised as necessary, that’s a formula for success.
If your spending plan is to spend randomly until your next paycheque then either eat noodles when you run out of money or save whatever is leftover, then there’s a really good chance that you’ll be living from paycheque to paycheque for the rest of your life – or until you figure out that this is not a formula for success.
So my one piece of advice, regardless of your income, your stage of life or your financial position, is to take some time to look at what you’re spending your money on.
Grab a pen and paper or an Excel spreadsheet, dig out your statements or open your banking app and spend some time with your numbers. How much are you spending on groceries each week? Or meals out? Or shoes/bags/clothes/whatever your weakness is? Do you have automatic payments coming out of your account that you’re not sure what they’re for?
Having a spending plan isn’t about denying you all the good things in life. It’s about making sure you can afford all those wonderful things you want from your life.
Don’t delay. Do it today!
Bonus points if you also set some financial goals.
Double bonus points if you have kids and they see you doing this.
Triple bonus points if you show your kids how to do this! What a gift you’re giving them.
