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My Top Ten Personal Budget Tips

If you’ve been around me much, you already know I’m all about a personal budget.  You may tell me you have a marriage problem and I’ll tell you to do a personal budget.  You may tell me you have problems at work and I’ll tell you to do a personal budget.  It is the closest thing I have to offer as a cure-all for your ails.  Why?  Because a budget is awesome at helping you set priorities, short- and long-term goals and if you’re married, you can’t do a budget without communicating with your spouse about the thing that usually is a huge issue in marriages – you guessed it…money.  It is also the absolute best of any of the debt management plans you can get and it doesn’t cost you anything except some time and some focused thought.  Today I’m going to share my top ten personal budget tips with you and hope you can find the time and gumption to refocus on doing a budget.  Personal finance has very little to do with math – get a calculator if you can’t do that part.  Don’t let that be an excuse.

  1. A budget is not about money – it is about PRIORITIES.
  2. Your perception of what is important will determine your willingness to follow your budget – so seriously consider the question of what is important vs. what isn’t.
  3. Emergencies happen, but not all unexpected hiccups in life should be emergencies.  Build an emergency fund and you will find fewer and fewer “emergencies” happening in your life.
  4. Do NOT use a credit card as your emergency fund.  Do you want to make payments on a bad life experience or get it over with and move on?  Use cash to save for emergencies.
  5. A budget must be simple, answering only four questions:
    1. How much money do I make (after taxes)?
    2. How much will I save?
    3. How much are my ongoing monthly expenses (lights, water, phone, cable, internet, etc.)?
    4. What are my debts and how am I paying them back?
  6. Do your budget before pay day. “Spend” ALL the money on paper before you have it and then use your budget to drive how you spend it in reality.
  7. If you’re married, you must agree with your spouse about your household budget.  Fight as much as needed to come to an agreement on your budget, but AGREE.
  8. Remember that you are in charge!  If you screw up your budget, it wasn’t anyone else’s fault.  Take charge of your finances rather than thinking someone else has to do it for you.
  9. Debt = Risk.  There is no exception to that equation.
  10. Your budget must be done every month.  Each month is different, so don’t just do one budget and think that’s the end-all, be-all answer to your personal finance challenges.
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