Weekend of December 14, 2007
Today's Tip: Adjust Your Budget if Things Change
This might be the most practical budgeting tip, and the most obvious. However, many
stated last week, just as a budget is meaningless without a variance report, wide
discrepancies between budgeted and actual figures also render a budget meaningless.
Common circumstances that would warrant the amending of a budget would be change in
job status, addition of a family member, the refinancing of a home, purchase of a car, or
any other major purchase added or expense deleted from your monthly ritual.
If your budget is consistently +/- 10% of your actual month-end figures, you are
improperly budgeting. Improper budgeting nearly always leads to reckless spending,
because it's human nature to spend what one feels as excess. There's the Jones' factor, the
kids that want new toys, and the vacation you've been meaning to take for years. If you
are under-budgeting, you may be setting yourself up for failure without even knowing it.
Keep yourself honest, and don't trick yourself into a situation that will leak any excess
funding out of your bank account's exhaust pipe!
Have you downloaded the free budget yet? Our free budget spreadsheet is updated for
2008 and features a monthly account tracker and budget form!
This might be the most practical budgeting tip, and the most obvious. However, many
stated last week, just as a budget is meaningless without a variance report, wide
discrepancies between budgeted and actual figures also render a budget meaningless.
Common circumstances that would warrant the amending of a budget would be change in
job status, addition of a family member, the refinancing of a home, purchase of a car, or
any other major purchase added or expense deleted from your monthly ritual.
If your budget is consistently +/- 10% of your actual month-end figures, you are
improperly budgeting. Improper budgeting nearly always leads to reckless spending,
because it's human nature to spend what one feels as excess. There's the Jones' factor, the
kids that want new toys, and the vacation you've been meaning to take for years. If you
are under-budgeting, you may be setting yourself up for failure without even knowing it.
Keep yourself honest, and don't trick yourself into a situation that will leak any excess
funding out of your bank account's exhaust pipe!
Have you downloaded the free budget yet? Our free budget spreadsheet is updated for
2008 and features a monthly account tracker and budget form!
My Financial Profile - MyFinPro.com
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