Budgets are like the New Year’s resolutions of personal finance. We all know we should have one and we all know it’s a fairly simple thing to follow—at least in theory. Like resolutions, we often map out personal budgets with the best of intentions, only to abandon them a couple of weeks later.
It’s easy to blame our budget failures on the numbers we use, or the categories we create, or even the specific app or budgeting system we choose—but more often than not, the underlying cause of a hard-to-stick-to budget is our relationship with it. Just like resolutions, if we design budgets that are too restrictive or too vague, there’s no motivation to follow them.
Whether you’re planning your first budget or re-evaluating your current budget, the ground rules listed below will set you up for success by changing the way you look at budgeting. It doesn’t matter if you manage your budget online or if you prefer good ol’ pen and paper — these budgeting basics can be applied to every budgeting system.
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