By Matt Fraser
“The plans of the diligent lead to profit as surely as haste leads to poverty.” Proverbs 21:5
We all realize having a budget is probably a good idea, but creating one and sticking to it require different skills. Just the word “budget” seems to drain the life out of most of us, but there are ways to make it more attractive. It might help to consider the benefits of a budget.
One advantage is that it provides us the opportunity to spend our money on paper before it leaves our pockets. Why is this important? Our financial lives are complex; bills tend to arrive on different dates, and paychecks have to last for weeks or months. Planning how we intend to spend our money ahead of time can help us maximize our income. This could actually help us enjoy life, rather than drain it out of us because we’re always coming up short at the end of the month and stressing about how to pay the bills. Maybe the concept of a budget isn’t so objectionable after all.
Many wrongly assume a budget will restrict what they can do, but if we keep in mind that we are in charge of our budget—and not the other way around—we’ll still be able to breath comfortably under a budget. Few of us are really that overbearing with ourselves, anyway. If you’re still worried about the way a budget might manhandle you, keep this in mind: If it’s not a priority, we can leave it out of the budget.
Another argument against personal budgeting contends that only weak-minded people need the organizational assistance of a budget. Proponents of this objection say you shouldn’t have to keep a written record in order to manage your money. In a macho society it’s easy to buy into this excuse, but in reality, it’s a weakness if we don’t have a tangible way to evaluate how well we keep our financial plans.
Proverbs 21:5 is only one example of the many scriptures which advise that planning is wise. Any successful athlete can attest to the importance of having a well conceived training plan and holding themselves accountable to it. The successful physical principal of discipline works similarly with money, as well. Budgets are not for wimps.
However we construct our budget, we want it to track at least three things: money in, money out, and money saved, or—but hopefully not—money owed. Here’s a sample of what a budget might look like:
Income: Estimated Actual
Monthly Inc ________ ________
10% ________ ________
Total: __________ __________
Emergency ________ ________
Future Purchase ________ ________
Total: __________ __________
Housing ________ ________
Car Payment ________ ________
Utilities ________ ________
Insurance ________ ________
Gas ________ ________
Groceries ________ ________
Cell Phone ________ ________
Internet ________ ________
Entertainment ________ ________
Pocket Money ________ ________
Total: __________ __________
Total Tithe, Savings, Expenses: __________ __________
Income over Total Expenses: __________ __________
As we consider our spending, we should not hesitate to set a realistic goal for tithing and determine to faithfully keep it. We can test God in this, “says the Lord Almighty, ‘and see if I will not throw open the floodgates of heaven and pour out so much blessing that you will not have room enough for it’” (Malachi 3:10). These blessings won’t necessarily all be financial, but it’s so rare that God gives us permission to test Him. How can we pass up the opportunity for God to show His faithfulness in our lives?
For saving money, nothing works as well as automatic transfers from checking to savings accounts. Seems the more we think about saving money, the less we have left over at the end of the month. If it’s done automatically, the “out of site, out of mind” principal applies. A good savings goal for those just starting out is to build a reserve that would cover six month’s worth of expenses. This should be kept in an easily accessible, interest-bearing account, preferably something like a money market account. Such a cushion would ensure that we are never one paycheck away from the street. However, if you have debt, consider paying it down first, since the interest rates on debt are higher than those paid on investments.
There are other helpful strategies to save money. You know the See-Food Diet, but have you ever heard of the See-Money Malady? You see money, so you spend it! If you are suffering from this irritating condition, don’t leave cash lying around to tempt you. Try keeping it in your freezer, frozen in a block of ice. In this way, you still have it, but you really have to go out of your way to get it. In the meantime, you have to ask yourself, “Do I really want it that badly?”
Every single man should also have one of these: a coin jar. Everyone I know who has one of these has been pleasantly shocked at how much change they cashed in when the jar filled up. One friend had over $500 in his jar. Where would all that change go if the jar hadn’t caught it? a. Dropped on the street; b. Between couch cushions; c. In the floorboard of my car; d. all of the above. However we answered, it makes more sense to put it in a jar.
Also, we should beware of relying on credit cards as a “safety net.” Remember, once we’ve reached our limit, we’re already deep in a hole. Don’t bank on making enough money to recover after the “emergency” is over—it may not happen! A better strategy to use for expenses we can’t budget every month, like yearly insurance payments, seasonal clothing needs or car maintenance, is to keep a monthly savings goal and periodically put enough back in preparation for these unscheduled bills.
Finally—although this might come as a surprise to some—we should consider entertainment a legitimate expense. There are many things here on earth that God has given us to enjoy, so long as we enjoy them in the right proportion, and at the proper time. Don’t feel guilty about putting some fun money in the budget.
After we’ve created our budgets, periodically we should sit down and compare what we spent with what we budgeted. At first we may be way off the mark, but don’t lose heart if this happens. Keep at it! After we’ve evaluated the past month, we can create a more realistic budget the next month, with last month’s expenditures in mind. The budget is a dynamic document—ever changing.
Most of all, after all our hard work, we should reward ourselves with something fun. I don’t suggest blowing up the budget like they would on “Mythbusters.” I do suggest something pleasurable to anticipate after you finish the finances. As the above proverb indicates, being diligent with a budget will lead to profit, but that doesn’t mean we can’t have a little enjoyment along the way!