This guest post on budgeting is by Ryan Bonaparte, who last wrote for Add-Vodka in 2012 about common financial mistakes that young adults make. Ryan is a long-time writer and author, delving into topics including personal finance, technology, and career pursuits. He lives in the Boston area with his wife and fiercely independent cat.
Budgeting can be an amazing tool.
From the moment you begin to track where you’re spending your hard-earned money, budgeting can help you begin to understand what your habits are, where your priorities lie, and what goals you want to set in place. That’s a powerful place to be in life, as you can move past surviving paycheck to paycheck, and on to building a security net and further wealth.
I often talk to my friends about the power of moving my money away from the things I don’t care about (a bigger house) to the things I do care about (a nicer car). While you can’t have everything because of a budget, you can put budgeting into an action a plan to have anything with a bit of planning and hard work.
But efficiently earning and spending money is not the meaning of life. There are other factors to consider when deciding how to spend your money, and more importantly what to do with your life outside of budgeting.
The Impact On Your Quality of Life
We all know the stories of cutting out $4 coffees to save for your retirement. And while this might be a good place for most people to save money, if you truly love and look forward to your morning latté, then maybe that $4 is money well-spent.
The same might go for paying for cable. Cutting out true pleasures (when we’re honest with ourselves about what truly falls into that category) is a surefire way to regret the journey.
Impact of Budgeting on Long-Term Goals
Not every goal is a financial one. Sometimes it comes down to what you want to be able to say you’ve accomplished 50 years from now. If traveling is big on your agenda, then a short road trip might make financial sense, but a flight to another continent might fit better with your goal of being a world traveler.
If you want to plan a retreat for your friends, spending a few extra dollars to cover a struggling friend’s expenses might make the experience much better than if you just said tough luck.
The Impact On Your Family
Families are an essential part of our lives as humans, whether it’s our biological families, or those that we’ve come to call family, spending quality time with them enables us to face some of the inevitable challenges that arise. If we are eliminating time with our families to earn more money or to save on travel expenses, then at some point we need to ask ourselves why we’re even working in the first place.
There’s nothing wrong with budgeting, and many who live without a budget are doomed to suffer because of it. But don’t let blindly following that budget remove the experiences that we all really live for.