Budgeting: Why All the Negativity?
OK - let's start with the elephant in the room: the word budget. Most people equate the word budget with the need to cut back. Like some kind of financial diet....which makes most people cringe.
So if the headline to this post turned you off, let me say now that I'm not advocating for you to cut back on spending in order to save more. In order to circumvent the negative feelings we have toward the word budget, I'm going to propose that we use a different term that doesn't spark innate vitriol: cash flow management.
My sense of budgeting is really more like cash flow management. It's not necessarily eating out less or nixing your fancy cable package. Budgeting is more understanding the cash you have coming in each month, and where it typically goes. The difference between the two, of course will either pad your savings every month or take from it. And understanding these moving parts gives us a sense of how quickly we're growing net worth, and when we might reach our various financial objectives.