Knowing exactly where your money goes has become increasingly important. You must track every dollar spent from your income source, whether it is tithes, mortgage/rent, groceries, or a new pair of shoes. If you don’t tell your money where to go, it will gladly take you somewhere, leaving you wondering, guessing, and thinking, “Where has it all gone?”
How do you then tell your money where to go? By creating and sticking to a budget. A budget is you telling your money where to go instead of wondering where it went (Dave Ramsey).
Some benefits of having a budget:
- A budget helps in controlling expenses. The action of listing all your expenses gives us a level of awareness as to the nature of our spending patterns. This will result in you being deliberate in cutting back on particular spend or seizing your spending in particular areas.
- It allows you to live within your means by the very action of cutting back or seizing to spend in unnecessary areas. If our day-to-day expenses need to be supplemented by debt, i.e., using credit cards or borrowing from friends or family, you are definitely living above your means. On the flip side, if you are experiencing an abundance of cash flow, a budget can help to reduce haphazard spending, leaving more for charities and the needy.
- A budget can help you reach your financial goals as it gives focus. So, regardless of your goals, whether it be savings, paying off debt, or investing, creating a budget can show you how much money you can put toward each goal.
“The plans of the diligent lead surely to abundance, but everyone who is hasty comes only to poverty” (Proverbs 21:5). So, let’s be intentional about how you spend your hard-earned cash.
