Where has all my money gone? Do you ever ask yourself that question? You get to the end of the month, sit down to write out a check for your electric bill, and see in your checkbook register that you don’t have the funds to cover it. You know you’ve gotten paid twice this month. You remember buying a few groceries, a few non-essentials, and paying a few bills, but the rest of your money seems to have just disappeared. So you wonder, where has all my money gone?
First of all, if you use a debit card or write checks for most of your purchases, you’ll have at least a general record of where you spent the bulk of your money just by looking at your checkbook register and/or bank statement. But if you get cash out of the ATM and spend it randomly, you may be completely clueless as to where your money went. Spending cash isn’t bad. In my opinion, it’s good to pay in cash. But unless you write down the purchases that you make with cash, you may not remember what you spent your money on.
You can’t possibly know where all of your money has gone unless you know what all you spent it on. Remembering all of your financial transactions is virtually impossible though. So, how in the world are you supposed to know where your money has gone? By using a budget.
I know, now you’re probably tempted to quit reading since I used the “B” word, but humor me a minute. A budget isn’t as scary, or restrictive, as it sounds. It’s actually the easiest way to be in control of your finances and to know where all of your money has gone.
The goal of budgeting isn’t to spend as little money as possible. It’s not to restrict your spending. It’s simply a tool that you use to be aware of your finances. With a budget, you’re actually supposed to spend money. That’s probably the complete opposite of what you thought, but it’s true.
When you budget your money, you decide beforehand that you are going to spend money on certain things, and you decide the amount of money that you’re going to spend on each of those things. It’s that simple. Do you like to golf? Decide the amount of money you’re going to spend on golfing. Do you have pizza delivered for dinner every Tuesday? Decide the amount of money you’re going to spend on pizza.
Your budget will only be as restrictive as you make it. Be realistic. Adjust it if, or when, necessary. Just make sure to follow it.
So, my advice regarding your own personal monthly budget is this: Make a budget, follow your budget, and relax knowing that you’ll have the money to pay all of your monthly bills! After all, a budget is the easiest, most practical way to know where all of your money has gone.
Article by Randi Millward