Twenty Something Sense

This is the first release of one of our content sections which can be found in ‘Budgeting’.  As we noted in the release of Twenty Something Sense 2.0, we will continue to release content we feel can be referenced over time in the sections in the top navigation.

This section will start by telling you why you need a personal budget and the move into how to create a budget.  These sections will cover the basics and we will next explore creating your first budget (via spreadsheet), and using tools such as Quicken and Mint.com to manage your budget.  Stay tuned for updates via the blog.

Why do you need a personal budget?

I think the question of ’Why should you use a budget?’ is often times used in self-defense, but it is a valid question none-the-less.  Typically budgeting has a very negative connotation attached to it and most think, like a diet, that budgeting means spending less (as with a diet – eating less).  What you will learn is that budgeting is quite the opposite.  When done correctly a budget should tell you where you can spend (or save) your money it will not tell you to stop spending money.

There are many reasons to create and use a budget, but they can all be boiled down to what we call the ‘Three Values of Budgeting’.  A budget will empower you to make better decisions, give you the visibility into your spending habits to save more money and overtime greatly aid your financial security.

Here is a brief summary of the ‘Three Value of Budgeting’ which will be used through-out the budgeting material.

     You will make better decisions with your money - With a budget, you will be able to make better informed decisions, such as deciding if you can afford your dream vacation or if you need to save more money.

     You will save more money – With a budget, you will be able to understand where you currently spend your money which will show you where you can afford to cut-back and save money.

     You will decrease your financial risk and increase your financial security – With a budget, you will be able to build a savings cushion and have clear visibility of your financial standing. This will reduce your risk, increase your financial security and let you sleep better at night.

So, if you would like to make better decisions with your money, save more money and decrease your financial risk while increasing your financial security, budgeting is for you.  The next section, below, will give you an understanding and mindset of how to create a personal budget.   In this section you will see elements of the ‘Three Values of Budgeting’ and you will get to see them in action if you continue on to create a budget!

If on the other hand you are still not convinced why everyone should at least have a basic budget, I highly suggest reading one of our guest bloggers posts entitled “A Plan, a Failure and a Lesson-Learned”.  Or if you prefer, do not hesitate to leave a comment or contact us to gain guidance or get questions answered!