Top 7 Budgeting Myths
Having to make sound financial decisions is a lifelong learning process. If you have a major long-term goal you want to achieve, such as a home remodel, you have to be careful about each financial step you make.
But being in control of one’s finances and day-to-day spending is not easy. Many of us find it extremely challenging to create a financial plan and stick to it. And this is where a monthly budget comes into play. A budget helps you visualize how much money you make and how you spend it.
However, many of us find the process of setting up a budget intimidating: we would rather stay oblivious to the fact that we are actually overspending every single month. We live in a consumer society, and rising living costs aren’t making it any easier for us to limit our spending and save money or at least employ the financial resources at our disposal more rationally.
Have you ever tried setting up a budget so you can better manage your finances? Whether you were able to follow through despite the challenges you’ve encountered along the way, or failed and gave it up, take a look at the most common budgeting myths according to Blackhawk Bank.
What Are the 8 Most Common Budgeting Myths?
Myth #1: You have to be good at math and numbers to be good at budgeting.
Actually, all you need for a budget is some basic addition and subtraction. Budgeting has little to do with actually doing the math, and much more to do with planning ahead. There are also user-friendly apps and tools you can use to create and manage your budget.
Myth #2: Creating a budget is too time-consuming.
If you are diligent about following a monthly budget, over time it becomes second nature. Besides, that is where all those budgeting tools and apps come in: helping you save time and money.
Myth #3: You do not have to have your budget in black and white.
A written budget is tangible, the one you create in your head is not. Writing down a plan can help you ensure you will have enough money until your next paycheck because you will see it all in black and white and decide which costs are avoidable, and which are not.
Myth #4: Budgeting is boring.
While budgeting may not sound like the most binge-worthy activity in the world, it can be incredibly rewarding once you get the hang of it and actually start saving money.
Myth #5: Keeping track of your spending is the same as budgeting.
Not exactly. A budget is a plan that helps you control your spending, so it also helps you save money you can later put to good use.
Myth #6: A budget has to be restrictive to make sense.
For people who enjoy buying clothes online or getting takeout daily, the idea of having to stick to a budget usually means one thing: sayonara to these occasional splurges. But that’s not true. Sure, you’ll have to practice some self-control if you want to achieve a worthwhile long-term goal, but that’s what makes the process of learning to save your hard-earned cash so rewarding.
Myth #7: Creating a budget is pointless because there are always unforeseen costs.
You must have experienced it at least once: you do your best to save up for something, perhaps a family road trip, or a handbag with an outrageous price tag, but then something unexpected comes up and you have to spend your extra cash on that. That does not mean all the work is futile. Yes, unexpected costs could force you to make a dent in your budget. But a budget will also help you save enough money so that you can afford to cover these unforeseen expenses without breaking the bank.
Myth #8 Budgeting makes no sense if you don’t make enough money.
Anyone can have a budget, and it has very little to do with how much you make. A budget actually helps you make the most of the money you do have at your disposal.
What Is the Takeaway?
Writing down a monthly plan can help you decide how much you can spend and save each month. And remember, you are doing this for you. Don’t be too hard on yourself, so even if you do miss your monthly target, just pick yourself up and start over. If you’re diligent about budgeting, you’ll get the hang of it eventually!