Budgeting is a lot like dieting.
They both work in theory, but in the real world they are almost worthless.
Surprisingly, the secret to controlling spending is to abandon strict and impossible rules.
And forget the complicated online programs too.
Few people are disciplined enough to track their spending, but more importantly, monitoring expenses does little to change behavior.
If you track your restaurant purchases, for example, and discover you spend $300 a month, what does that tell you? It does not answer how much you value eating out and arbitrary historical numbers do little to modify your spending.
Perhaps the $300 is a frivolous waste, or maybe restaurants are the only place your family gets quality time together. In this case, the $300 a month may be the most important thing you buy. What’s outrageous to some families is insignificant to others.
Instead of boring recording keeping, you need to figure out what is really important to you. Your buying choices when funds are limited is what brings your true values to the surface.
The system that works best for most people… Continue reading