Published on March 29, 2015 4:41 pm, by Andrew Brown
A budget is your magic tool when it comes to financial wellbeing. Without one, you might as well give your money away.
Adriano Zumbo is the undeniable master of the macaron. No one quite knows a 15-minute meal like the delicious Jamie Oliver. And here at MoneyBrilliant, we know budgets! We’re in the business of cooking up brilliant budgeting ideas and our masterpiece is the MoneyBrilliant money manager tool
For many people, a budget is like fine dining; it’s a beautiful experience but it’s not savoured very often, and let’s face it, once it’s done it’s quickly forgotten. The truth is, creating a budget is an easy appetiser to the main course – mastering your money. My Money Manager understands this and creates a tailored budget for you, and takes most of the hard work out of your hands. All you need to do is mix it up and season it to your taste.
Let’s keep going with the cooking analogy and look at budgeting like a recipe. Add a pinch of this, subtract a dash of that, all to create the perfect balance of flavours.
What are the key ingredients for a financially brilliant feast? Let’s take a look:
• Pay: Essentials or fixed costs; what you pay every month (things like rent, mortgage, petrol)
• Save: What you can devote to savings from the remaining
• Spend: Lifestyle; the fun stuff that you choose to spend on each month
Budgeting is all about deciding how you spend your limited financial resources and prioritising your ‘lifestyle’ spending. All the while securing some savings for the future.
It’s all about choice
You always have a choice. You can choose to buy a $10 pre-made salad from the deli or you can choose to prepare your lunch at home and redirect those saved dollars towards your debt balances. As I said, the choice is yours. As with your personal health, it comes down to balance and moderation. If you want to feel your best on your journey to being financially well, successful budgeting and learning to live within the bounds of your lifestyle spend, will surely set you on to the right path.
Still not sure why you need a budget? Here are five tips to tempt you:
1. My Budget Rules
A budget helps you figure out your long-term goals and work towards them. If you drift along aimlessly through life, tossing your money at every pretty, shiny object that happens to catch your eye (we know, Thermomixes are very tempting!), how will your ever being able to save enough money to buy a car, take that trip to Thailand, or get together a deposit for a house?
2. Don’t attempt a croquembouche if you’ve only just mastered scrambled eggs!
It’s crazy. Far too many Australians are living beyond their means and spending money they simply don’t have. Australians owe almost $50 billion in credit card debt and nearly 1 in 2 people use credit cards for the basics such as groceries, petrol and bills. By using MoneyBrilliant’s automated Budget you’ll be able to see exactly how much money you earn, how much you can afford to spend each month, and how much you need to save.
3. Whoops! There’s the smoke alarm!
Emergencies and unexpected situations are a part of life. We will all have some type of emergency at some point in our lives. A budget is the perfect tool to help you prepare for such moments. You might be retrenched, become sick or injured, go through a divorce, or suffer a death in the family. These all have the potential to lead you in to some type of financial crisis, and they always seem to come up when at the worst possible time. There’s never a great time for an emergency, but now is a great time to start preparing for one. Quash that smoke alarm now by thinking about how you can include an emergency fund in your budget. Aim for a minimum of three months worth of your household expenditure and you’ll ensure that you don’t spiral into the depths of debt after an unexpected event.
4. Stop walking on eggshells and break those bad habits
Your MoneyBrilliant budget will help to see your spending habits – good and bad. It will become very clear, very quickly, if you spend far too much on clothing, salons, and dining out. Take an open-minded look at the results and ask yourself a very simple question: do I really need to spend that much money on these things? $400 on coffee? $600 on shoes? Your budget allows you to rethink your spending habits, re-focus, and realign to meet your financial goals.
5. ‘Sweet’ Dreams
It sounds too good to be true, but by using a budget, you’ll be able to get more sleep, and rest easier you will! How many nights have you tossed and turned worrying about how you were going to pay the bills? Some 33% of Australians admit that worrying about money causes them sleepless nights. People who lose sleep over financial issues are allowing their money to control them. Take back control. When you budget your money wisely, you’ll never lose sleep over financial issues again.
In a nutshell, creating a budget is all about prioritising your lifestyle spending. And just as every healthy, wealthy, and wise woman knows, you can’t always have your cake and eat it too. Creating, maintaining, and nurturing your budget will help you grow into a more balanced, healthy, and financially well woman.
Here’s the thing about budgets, they are hard. They take discipline. Being human means being disciplined 100% of the time is not impossible. But discipline can be practised and mastered like anything else. Take a break from thinking about money and budgets for a few minutes (we can’t believe we just said that). Close your eyes and sit comfortably in your favourite window sill. Breathe. Think of nothing… just for a few minutes. Leave your thoughts of what’s happening on your facebook news feed behind, don’t think about how many sports events you have to get the kids to today. Clear your mind… just for a few minutes. Nice, that’s discipline, practice it and budgets will be a breeze.