The Truth About Budgets
Learn the Truth About Budgets
Want to know the truth about budgets? Truth is that for most people they can't follow one, so they lie to it. Is that you?
Do you constantly find yourself not following your budget, or worse yet, you haven't created one yet? Why is that? Here's why. Because nearly everything we've been taught about a budget makes it seem as though it's a restrictive mechanism that tell us how to spend our money and takes away our freedom. Right? Isn't that the truth? Here's a wake up for you. By
definition, the term budget means "a way to pay for planned
expenditures or purchases". Did you catch that? You decide what you want and then you figure out a way to pay for it. That doesn't mean you just buy it and hope you can pay for it. It means that you want it, you plan for it, you pay for it, then you buy it. That's a true budget. If you want to buy more stuff and do more things, you have to
create the income stream to pay for it. It's that simple.
Here's another truth about budgets. Most budget programs or systems don't work with the way we spend money today. They are designed to track money in what we at the Debt Free Project term as an old fashioned way. It's because they were designed when we operated mostly on a cash or check basis. In commerce today consumers spend using debit and credit cards; electronic funds transfers; auto bill-pay and withdrawals; and of course, cash and checks, though much more limited. Because of this, we interact much less with our money (it's just a swipe of a card or the press of a button on your computer). Additionally, all of these ways of paying and the speed at which we live means that it is much more difficult to track our spending. This is another reason budgeting doesn't work for the majority of American consumers.
Remember the old envelope budgeting system? If you don't, here's a quick recap. It's Friday and you just got paid. You run to the bank and you cash your paycheck. Then you take that cash and you divide it into different envelopes, each with the name of a budget item (house, car, insurance, groceries, entertainment, etc.) During the month, you spend the cash. If you overspent in one category, you make a conscious choice of which other envelope to take that cash from. When the money was gone, it was gone.
Now let's compare that with what happens today. Our check is auto-deposited by our employer (or maybe we still get a physical check which is deposited into our checking or savings account where it will wait for us to spend it). Then, we pay our bills using the plethora of payment methods available. We don't really track our daily spending so we don't really know how much we have left until we check our balances. When the money is gone, we continue to spend by using one of our many credit cards. Then when the statements come, we're surprised at how much we overspent. It's a nasty repeating cycle that is costing consumers a fortune.
At the Debt Free Project, we want you to take control of your finances starting today. As a "thank you" for visiting our site and to get you started on the path to wealth, we want to provide you for FREE (a $9.95 value) an E-Book called Money for Life. It was written by the founder of a company called Mvelopes which has created an on-line personal budgeting system that we think is great. It's not perfect, but it is great. Mvelopes is pleased to offer visitors to the Debt Free Project web site a FREE 30 day trial of their program called Mvelopes Personal 3.5. Check it out to see if it works for you. Want us to coach you on using the software with our My Debt EdgeTM Advanced Credit Strategies? Contact us.
Where Would You Like to Go Next?...
Want to know the truth about budgets? Truth is that for most people they can't follow one, so they lie to it. Is that you?
Here's another truth about budgets. Most budget programs or systems don't work with the way we spend money today. They are designed to track money in what we at the Debt Free Project term as an old fashioned way. It's because they were designed when we operated mostly on a cash or check basis. In commerce today consumers spend using debit and credit cards; electronic funds transfers; auto bill-pay and withdrawals; and of course, cash and checks, though much more limited. Because of this, we interact much less with our money (it's just a swipe of a card or the press of a button on your computer). Additionally, all of these ways of paying and the speed at which we live means that it is much more difficult to track our spending. This is another reason budgeting doesn't work for the majority of American consumers.
Remember the old envelope budgeting system? If you don't, here's a quick recap. It's Friday and you just got paid. You run to the bank and you cash your paycheck. Then you take that cash and you divide it into different envelopes, each with the name of a budget item (house, car, insurance, groceries, entertainment, etc.) During the month, you spend the cash. If you overspent in one category, you make a conscious choice of which other envelope to take that cash from. When the money was gone, it was gone.
Now let's compare that with what happens today. Our check is auto-deposited by our employer (or maybe we still get a physical check which is deposited into our checking or savings account where it will wait for us to spend it). Then, we pay our bills using the plethora of payment methods available. We don't really track our daily spending so we don't really know how much we have left until we check our balances. When the money is gone, we continue to spend by using one of our many credit cards. Then when the statements come, we're surprised at how much we overspent. It's a nasty repeating cycle that is costing consumers a fortune.
At the Debt Free Project, we want you to take control of your finances starting today. As a "thank you" for visiting our site and to get you started on the path to wealth, we want to provide you for FREE (a $9.95 value) an E-Book called Money for Life. It was written by the founder of a company called Mvelopes which has created an on-line personal budgeting system that we think is great. It's not perfect, but it is great. Mvelopes is pleased to offer visitors to the Debt Free Project web site a FREE 30 day trial of their program called Mvelopes Personal 3.5. Check it out to see if it works for you. Want us to coach you on using the software with our My Debt EdgeTM Advanced Credit Strategies? Contact us.
Where Would You Like to Go Next?...
- Pay Less Interest- Learn About "Interest Cancellation"
- Pay Off Your Mortgage in Record Time- "Interest Cancellation" and your Mortgage
- Credit Repair- The Truth about Credit Repair
- Credit Scores and Reports- F.I.C.O. Scores and Credit Reports
- Sign Up for FREE Stuff- Get Free Stuff from the Debt Free Project
- Other Financial Resources- Great Links to More Financial Resources* Coming Soon