Budgets are like diets. Most people will tell you they need one, most people have tried one at some point, and most have failed at some point in establishing or sticking to one. Creating a healthy financial picture requires a lot of the same principles as creating a healthy body. It requires hard work, discipline, having a plan in place, and sticking to that plan. I am going to stick with the diet analogy throughout this post because I find it very appropriate and because I have a passion for fitness, having spent several years teaching people about health and fitness as a personal trainer.
One way budgets and diets are similar is that almost any budget is better than none. The Atkins diet, the paleo diet, flexible dieting, clean eating, and counting your macros are just a few of the popular diets out there. While they each have their benefits and some would argue that one is better than another, few would disagree that any diet is better than none. The same goes for budgets. There are many different ways to establish a plan for your finances, but the important part is that you have a plan in place. Saving money without a plan is is very difficult to do. Having a bad or incomplete plan in place for your finances will be a lot better than having no plan at all. I will be offering a lot more insight and tools in the future in order to make it as simple as I can for you to develop a plan for your personal finances.
Another way that budgets and diets are similar is that they need to be realistic. On January 1st a lot of people are going to get very motivated to improve their health this upcoming year. No doubt you will hear someone say that they are going to work out every single day, and they are only going to eat a specific type or quantity of food, and statistically they are probably going to fail. Oftentimes those people will fail within the first few weeks. A big reason for that is that they are just unrealistic. Sure, planning every single meal and working out every single day would be ideal, but as humans life will get in the way of that. A lot of times a financial plan will follow the same trajectory. It would be ideal to plan for every single cent that you are going to spend and every other cent gets put into savings, but that is just unrealistic. If you were to try to plan your finances that strictly you would no doubt find out real quick that life is going to get in the way. The key is to make something realistic. You are human and you are not going to be able to account for every cent that you are going to spend. Most bodybuilders will plan cheat meals where they eat what whatever they want to eat. A lot of times this is healthy for staying on track. The same goes for creating a budget. If you know you are going to need to treat yourself from time to time, build that into the plan.
The key to both diets and financial plans is improvement. To a 400 pound person, eating only 4 meals a day may not sound like much of a diet plan, but it is most likely better than what they were doing. The same principle applies to a person living paycheck to paycheck, not saving any money at all, and getting further in debt. Fixing your financial picture is a lot like getting the body you want. You can fail time and time again at achieving your goals, but you are can still be improving on where you were. Creating the healthy body you want or the healthy financial picture you want is going to take time. The key is improvement.
There are many more principles that apply to budgets and diets:
-It is important to set goals.
-If you get off track get back on as quick as you can.
-Tracking what you eat or spend is very important
-Put in systems to help yourself
-Be accountable to someone
I could go on, but I would be just belaboring the point. Like I said, I will be giving a lot of help on this idea in the future. I will be giving templates, instructions, as well as tons of tips on how to create a plan for your financial health.
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Understanding Finance 