One of the first things most adults have to do in their financial lives is set a budget. You were probably taught this from a parent, teacher, or even a friendly neighbourhood website. One lesson you might have missed: budgets fail. And that's OK.
Photo by Brad Montgomery.
As personal finance blog Once Cent at a Time points out, budgets fail. Or, perhaps more accurately, your life fails to fit neatly into the budget you made last month. Unexpected expenses arise, you miscalculate just how much you need for food, or you simply indulge more than you anticipated. A million things can cause your budget to fail. The trick is, that's alright. You can adapt your budget from month to month as needed:
If your budget fails in the first month, or all the 12 months, do not despair. You still have so many more months to live. Fine tune your budget to meet the two things first -- current need and future need. Have some provision for fun things. It's very important to keep aside money for enjoyment. Otherwise the whole purpose is defeated.
The point of keeping a budget isn't to force yourself into a rigid, unyielding lifestyle that can never be adaptable in any way. The point is to give yourself guidelines and goals. Prioritise saving, but if you find that your savings have cut into your food bill, dial it back a bit. Give yourself a long-term goal, but allow yourself room for short-term goals as well. Most importantly, don't give up on the idea of budgeting entirely just because one month didn't go exactly as planned.
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