Wednesday, March 8, 2017

Top 7 (Lame) Excuses For Not Building A Personal Budget

When we think of living paycheck to paycheck, most of us think of low-income families. After all, it is easy to understand how it may be hard to make ends meet when there is very little money coming in. What we have seen, however, is that the amount of money you make is rarely tied to whether or not you live paycheck to paycheck. A single mother making $40,000 per year and a married couple with no children making $110,000 per year could both be scraping by until each payday. Generally, it doesn't have to do with your income - it has to do with your budget (or lack thereof).

At our Lake of the Ozarks community bank, we talk frequently about the importance of budgeting and different strategies for building a budget. No matter how much we talk about it, though, it is ultimately up to you to make it happen. Unfortunately, statistics show that well over half of American do not keep a household budget.

What about you? Do you keep a budget? If not, why not? This week, First Bank of the Lake is here to examine some of the common excuses people give for not building a budget (and why they aren't valid reasons).

1. "I'm Not Good With Numbers."
This is possibly the most common excuse people give. If math is challenging for you, the idea of budgeting may seem difficult or impossible. However, you have access to countless free budgeting resources that will do the math for you. A quick Google search will reveal multiple free apps and downloadable spreadsheets you can use to maintain your budget.

2. "I'll Start Budgeting Once My Income Increases."
This is an other common excuse, but one that can have disastrous long-term consequences. It's true that your income should increase as your career advances, but your expenses will likely also increase as you eventually get married, buy a house, have children, and take on other responsibilities of adulthood. It is easy to get into the habit of putting off budgeting. The only way to ensure that you don't fall into this trap is to start right now, with whatever income you have. 

3. "I Don't Like Tracking My Spending."
If you don't want to see the facts about where your money is going each month, it's probably because you know, deep down, that you aren't spending it wisely. It can also be time-consuming to keep track of every purchase/expense throughout the month. If this sounds like an excuse that you would make, the cash envelope method may be a good option for you.

4. "It's Too Time-Consuming."
This one is partially true - building a budget does take some time, especially in the beginning as you experiment with different strategies to find the one that works best for you. However, once you find your rhythm, things will get easier and faster. It's just a matter of sticking with it long to see these improvements.

5. "I Don't Know Where To Start."
Let us ask you this: did you know"where to start when you studied for your first college exam? What about when you started you first long-term relationship? Your first day at your new job? We rarely know where to start when we first try something new, but we stick with it and eventually it becomes second nature. The same applies to budgeting.

6. "Budgeting Takes Away All The Fun."
This is a common misconception about budgeting. Most people assume that if you maintain a budget, you will never get to spend any money on "just for fun" purchases. However, successful budgets account for fun, miscellaneous expenses - they simply put a cap on them so that they don't get out of hand.

7. "I Don't Have Enough Money To Budget."
This is possibly one of the most dangerous excuses you can make. The reason you don't have enough money to budget is because you aren't budgeting. If you track your expenses and keep them within your income, you will have enough money. If you do it right, you should be able to achieve all of your financial goals such as buying a house, paying off debt, and planning for retirement.

There's No Time Like The Present!
The best time to start building a budget is always right now. Don't let these (or other) lame excuses prevent you from taking control of your finances and claiming the life you deserve. 

First Bank of the Lake is here to help you along your journey in any way we can. Our Kasasa accounts are perfect for young adults looking to improve their financial situation - like you! We offer free checking accounts with valuable rewards, and we can link these accounts to a Kasasa Saver account that automatically puts money into savings. Visit our website for more information about our Kasasa services.

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First Bank of the Lake - Striving For Excellence
Member FDIC. Equal Housing Lender.

Located at the entrance to the Osage Beach Premium Outlets!

4558 Osage Beach Parkway
Suite 100
Osage Beach, MO 65065

(573) 348-2265

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