With the holiday season fast approaching, we here at MattressNextDay thought it would be a great idea to bring up the topic of financial budgeting. It’s easy to get caught up with year-end shopping and gift-giving, which is why January is often filled with buyer’s remorse as those credit card bills begin to arrive in the mail. If you would prefer to start 2014 on the right financial track, it may be time to commit yourself to a budget.
Now when most people hear the word ‘budget’, they immediately leap to the conclusion that it is all about only buying sensible things and not having fun anymore. To some extent, this is true: budgeting forces you to make the right priorities while living within your means. If you are not in a good financial shape to start with, then budgeting means cutting back until you pay off debts and accrue savings. However, once this is all taken care of, budgeting actually frees you to enjoy your money with less guilt and worry.
Why should you budget? There are several reasons to get started. For one thing, it keeps you out of debt. Credit scores can mean a lot, especially when you are getting ready to buy big-ticket items like a house or a car. And then there is the significant peace of mind that you can get from knowing that you are living debt-free—you may not realize how important this is until you have actually experienced it after years of living beneath the specter of unpaid obligations.
On the upside, budgeting also lets you enjoy your income in a more sensible manner. When working within a budget, you have a firm grasp of how much money you have coming in monthly and how much is being used up. This simple limitation will keep you from frittering it away on the small stuff which do not really add any value to your quality of life. For example, if you are an impulsive shoe shopper, your closet is probably filled with inexpensive pairs of shoes which you hardly wear anyway. You no doubt get some gratification with these purchases but imagine how much happier you would be to be able to add your dream pairs to your collection—the ones that you know are very expensive but you will treasure for years to come. These pairs of shoes (or purses, or gadgets, or whatever else is in your wish list) are not exactly out of reach because you don’t have money; it’s just that you haven’t mastered how to delay gratification.
Budgeting helps you rid your closets and your house of clutter. It forces you to stop buying stuff that you don’t really want in order to afford the things that you will really value and keep. And it’s not just material things; it’s also about being able to afford a better category of experiences. For example, if you have always wanted to travel to exotic locations but have never been able to find the funds for it, look long and hard at where your money is going and let go of what doesn’t really add joy to your life; for instance, a simple thing like cutting out that expensive gym membership that doesn’t get used anyway. Find cheaper substitutes like an exercise DVD or a daily run at the park (or on the stairs of your building, if open spaces are hard to come by in your neighborhood).
What will make your life better? Have you always wanted to buy a luxurious memory foam mattress in place of that lumpy thing you sleep on night after night? Have you dreamed of upgrading to a new leather bed that will give your bedroom a sexier look? Think carefully about what you would really like; budgeting can get you these things in time.
In part 2 of this article, we show you a step-by-step guide to getting started with budgeting. It’s not as hard as you may fear.