“While some people want to talk bad about budgets, the budget is really there to serve you. Think about the big dreams you have, particularly the ones that involve money. A budget will help you see those dreams become reality. You can get out of debt. You can buy that new car. You can take that big trip, if you plan wisely and make your money work for you. A food budget is a great place to start.”
Years ago my husband and I thought we were frugal people. We looked for sales, drove used cars, and otherwise opted out of an extravagant life. However, it somehow missed our attention that we were still living beyond our means.
Since ours was a one-income, self-employed household, we’d never learned how to budget. In fact, we’d kinda dismissed it as being impossible to budget on an irregular income. Credit cards and home-equity loans fooled us into thinking we were doing just fine.
In 2007 we woke up and smelled the debt. Desperate to get right side up, we made some crazy-to-us decisions: we stopped using credit cards and we learned to spend less than we made. We built an emergency fund and paid for everything in cash. Now eight years down the road, we are freed up to do all kinds of things, like take our six kids to Europe for a month — paid in cash.
Budgets involve a basic comparison of income to expenses. The former needs to be bigger than the latter. It’s simple math.