- 1. Life is Unpredictable – The term “save for a rainy day” originated as far back as 1561 in a play called “La Spiritata”. The plot follows the story of a young man who secretly wed a woman with no dowry. He ultimately steals the money he needs from his father which is most definitely illegal, and the wrong way to save for a rainy day. When it comes to finances it’s best to learn how to expect the unexpected. Lay-offs, injury, or surprise pregnancy can all throw a wrench in your financial situation. Prepare for the unknown with a good budget.
2. Stress Free Bill Pay- If you don’t use a budget to pay your bills, you haven’t enjoyed stress free bill pay. There is something extremely gratifying about paying your bills on time every month according to the plan set forth in your monthly budget. You no longer have to worry about remembering which bills are due or paying late fees for accidentally forgetting to pay. Once you see exactly how much disposable income you have after all your bills are paid, it’s much easier to enjoy spending money.
3. Lead by Example- Budgeting as a family can not only inspire good financial habits in your children but also give you and your spouse more security. Once you combine household income and deduct your expenses you can begin to paint a picture of the future. You will see how much money you can put away for college or retirement. Working together as a family on a budget makes it easier for everyone to see the impact their decisions make on the bottom line. So often kids are left in the dark on financial matters which creates a sense of apathy towards being wasteful. If you are not comfortable sharing all of your details with your kids simply share a condensed budget with them and your expenses only. When they ask for something new refer to the budget and show them their impact on the expenses they affect directly, like food and utility consumption. Your kids will be less likely to take or use more than is needed, if they can see how that counts against that special thing they want .
4. Nobody’s Perfect- Even if you can manage to pay all your bills every month without reminders there is always room for improvement. Perhaps you could budget just your disposable income and what you spend it on. Are you spending too much money on food just because you can? Is there room to save more money? Are you in a position to make potential investments? All of this and more could be lingering in your finances but without seeing it in front of you, you’ll never know where you have room to improve.
5. Breaking Even or Falling Short- The most important reason to budget is to know how much money you actually make and spend. The reality could shock you if you find that you make just enough more to break even or worse, you are falling short. Falling short can make you lean on credit which costs you more money in the long run. With a budget you can decide whether you need to lower your expenses or find a way to increase your income. If you are just breaking even there is still room for improvement. Examine your expenses and look for ways to cut back. Your income should be divided between your expenses and your savings. If you find yourself not able to save any money it’s time to create a budget and find a way. Time to Save helps its members find money they wouldn’t normally have to save by providing cash back on every purchase. Visit timetosave.com today and see how!