Importance of Budgets That Work

Most people get into trouble because they don’t have control over their expenditures. This usually happens because they don’t have a working budget. Families without budgets are at the mercy of their caprices; their plastics leaving a destructive trail of deficit spending. They’re out of control with nothing to restrain them. They end up bankrupt and devoid of any credit respect and their credit ratings plunging to negative zones.  Having a working budget will help those who have it get onto the right track with respect to using their money wisely.

Start by writing budget plan

A budget that works usually focuses on tracking how much you earn against how much you can spend. You should know how to sort out your priorities especially against impulse buying. If you think life is going to be dull and less exciting if you can’t have your spending sprees, just wait till your credit cards are disabled and your credit rating is down to zero.

Involve your entire family in writing the family’s budget plan. They’re going to be more sympathetic when they ask money from you. They will cooperate in your budgeting effort instead of sabotaging it. Of course everyone will get their perks; everybody has their own personal needs to take care. However, in the back of their minds they know how much you have in your wallet and how much you can afford.

Forced savings

How much savings is enough? That’s a good question. The amount will depend on how much spending money in real terms is left with you after all the expenses have already been deducted. We’re talking about taxes, SSS, insurance, food, medical, and so on. If you manage to come up with forced savings after the spending dust settles down, it means that you’re spending less than your budget. Forced savings are offshoots of a working budget.


For a budget to work further, cutting some on none essentials is very important.  This includes cigarettes, liquors, dining out, watching 3D movies, and expensive clothing and body accessories. Vices and hobbies have to take a back seat for more important things that the family needs. Vacation trips, expensive cars, and other high priced house accessories will have to wait until your financial prospects get better.

Sharing the rent

Living with a friend is not bad as long as you choose the right one to live with you. Why do you need to share your rental expenses? Your rental budget shall not exceed one third of your income. If you’re earning $1500 and you’re renting an $800 pad, you’re going to fall short of your budget. Share your apartment with a friend and save on rent; doing this will help you live within your means. You’ll have a budgeting system that works nicely for you.