Budgeting is a necessary evil, which many families do not practice.
From person experience, I can tell you that when you do not track your monthly expenses, your money will fly out the door. That is exactly why my family sticks to a budget.
Being an accountant, I know firsthand the importance of household budgeting. I have worked with many small businesses that will also tell you that if money coming in (revenue) is less than money going out (expenses), they are in big trouble. A business operating without a budget will fail, and for that very reason, my family sticks to a budget.
I prepare our family budget on a monthly basis, and it works only because my wife and I are in agreement to where our money should go. A household budget is worthless if members of a family are not willing to agree on how the household money is spent.
On top of that, anyone that goes through a quality pre-marriage counseling course will learn the importance of a family budget. This is where we first learned the importance of a budget. Dave Ramsey teaches good money management, and offers many resources on his website.
We take full advantage of the online banking resources that our bank provides. Paying bills through the payment center, downloading the monthly statements in an excel file, and transferring money to and from the linked savings account, also helps as my family when it comes to our household budget.
My accounting background may provide a working knowledge to balancing our checkbook, but anyone can do it. This is important to us, so we can know exactly how much we have in the bank account at any point in the month. Our general family policy is: If we don’t have the money in cash, we don’t buy it. In relevance to businesses, if they don’t have the budget to hire their own accountant, they try to resort to outsourced accountant Singapore to help them with their financial statements and positions. This is actually a good idea to maximize efficiency and minimize cost.
I know that this may sound challenging to some, but it is how we live. I have a lot of single engineer friends that don’t choose to budget, and they have the latest gadgets – but a lot of them have debt to accompany these cool toys. I am much happier not having to worry how to pay my bills, which is made possible by having a family budget, and sticking to it.
By having a budget, we are able to have more money for vacations, date nights, and unexpected emergency situations that may arise.
Not only is having a budget practical, and saves money, but it also teaches your child how to be responsible with money. Believe it or not, your children watch everything you do. If you are bad with money, it is very possible that this trait will be passed down to your children. And if your children ring up a lot of debt, it is you – the parent – that will have to bail them out.
That is another reason why my family sticks to a budget.
Budgeting is an important part of our family, and allows us to have a more fulfilling life, without debt hanging over our shoulders.
Why worry about money, when you don’t have to?