Budgeting does not mean spending less
The word ‘budget’ has been stereotyped into a negative word that brings connotations of spending less, not having enough money and generally having poor spending habits. This is simply not true and it actually infuriates me that it has been cast as a negative term. Let me draw a parallel to another word so that you can see exactly the point that I’m trying to make. The word that rides right along side budget in so many ways is ‘diet’.
Think about it. The word ‘diet’ carries negative assumptions such as being over-weight, eating uncontrollably and needing a plan in order to lose weight. Although this is one purpose of a diet, much like saving money or controlling spending can be one purpose of a budget, this is far from the majority of its use. Lets take a look at their definitions:
budget - a statement of the financial position of an administration for a definite period of time based on estimates of expenditures during the period and proposals for financing them
diet - food and drink regularly provided or consumed
As you can see, a budget is simply a statement giving estimates on expenses and how they will be financed (income). As for a diet, it is simply the regular food and beverage that are consumed (regardless if you are gaining or losing weight). To explore and draw the parallels even closer, lets keep digging. Here are a few of the top reasons for using a budget:
1. Peace of mind – There is a lot to be said for simply being comfortable with your finances. It is guaranteed to help you sleep better, have lower stress and in general enjoy life much more. If you currently don’t use a budget it is almost inevitable that there are times where you are unsure if you have enough cash on hand, if you will have enough for your rent check to be cashed or if you’re saving enough for that week long vacation to the caribbean. The parallel to a diet is very similar. If you are consistently eating a healthy mixture of food and beverage you can rest assured that you are doing the right thing for your health and not overly worry about your next physical.
2. Target your spending – More than focusing on restricting your spending I think a budget actually shows you where YOU CAN spend your money. Many times a budget will show you were you are over-spending, but it can also show you the exact amount of money you have that YOU CAN spend and will assist you in deciding where to spend that money. Similar to a diet in that a diet will actually tell you what you can eat according to your goals. Although a goal could be to lose weight it could also be to gain weight or to eat according to your workout agenda (more carbs, more proteins, etc).
3. Save the exact amount you want – Again, a budget is not all about restricting spending, but can be used to meet your savings goals for vacations, cars, retirement, etc. And finally, this is exactly what a diet is designed to do. It is designed to target a specific type of health and/or physical outcome from the diet you choose. Although this might mean losing weight your goals might differ from time to time.
Hopefully I have convinced you that using a budget (or a diet) is not such a bad thing. In fact, it is outstanding for your financial health (see the parallel?). I use both a budget and a diet and I wouldn’t say that I have uncontrollable spending or eating habits! Anyone else using a budget out there? What made you move from not budgeting to being addicted to budgeting?
