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We have actually reached the first quarter of the year (whew that flew by). Hopefully everyone’s year is off to a good start. It is always a good idea to do a financial check in. This check in serves to make sure that you are sticking to your budget. If you don’t have one, then you have come to the right place. The focus of this blog post is to outline some basic budgeting essentials.
The first thing you will need to do is decide what method you will use to organize and track your finances. This can be a workbook, an excel spreadsheet or even a simple notebook. There are many choices available. Choose whatever method works for you and is easy to stay committed to.
Entrepreneurs
For those who are Entrepreneurs you will need to make sure to separate business from personal expenses. If you are not really good with spreadsheets, then you may want to invest in software such as QuickBooks. Taking this extra step would allow you to run your business more efficiently and not have to scramble at the end of the year to get everything together for tax purposes.
Once you have chosen your tracking tool you then need to set up a realistic budget. This budget should take into account your total expenses and income. It is always very important to save. I can not overestimate the importance of allowing for saving in your budget. All too many times people reward themselves by spending more and this overindulgence leads to that dreaded word, Yes you guessed it DEBT. We are not trying to do that. The less you owe the freer you are to enjoy your life.
We now have our tracking system in place. We’ve accounted for our expenses and income and also set aside an amount for savings. This is a great start for those who are new to budgeting. This process can also be used for Entrepreneurs. Again, make sure to keep personal funds separate from business funds. If you have not already done so, you should have a business bank account to deposit and release funds from. The more organized you are the better it is when it comes to staying on track with your budget.
Money Management
We will revisit the topic of money management throughout the year to see how well you are doing with your budget. Just like the goal setting How to Set Personal Goals How to Make Business Goals that we did earlier this year, it is not perfect. There will be times that you have splurged too much or forget to account for an entry in your tracking tool. Move forward anyway and keep working the system that you put in place.
The goal of any budget is not to punish you but to discipline you to be more successful at managing your money. We all know people who have great jobs but have nothing to show for it because they spend, spend…and spend. We also know people who know how to make a dollar stretch and live on less. This is not a coincidence. It takes practice, determination and discipline.
Recap
So, check in on your finances. See if you are sticking to your budget. If yes, great. If not, then what is stopping you from making some changes. If you are new to budgeting, welcome and get ready. Once you are able to see your plan come together and the role that managing your finances plays in enjoying your life and also eliminating stress you will understand that effective money management is essential to a well-balanced life.
The fundamentals of budgeting in your personal and business serve as your gateway to greater success and enjoyment in your life. Until next week my readers……Continue to live your dreams out loud
