How to Budget Using One Simple Rule

By Jesse Mecham

Have you ever started dieting and then found that your results weren't coming nearly as quickly as you would have liked? People don't learn how to budget correctly and then run into the same problem: the results don't match up with the work they're putting into it!

Truth be told, failure is almost certain with the way people are taught to budget these days. Some financial guru will announce they've come up with handy-dandy tables to compute what you should spend on every conceivable good and service...another will say you only need to worry about what you're saving (while that's great, you're leaving a lot of money on the table when that's your only focus!).

Examine the current balances (taking into account any outstanding checks, since those are already "spent") for your checking accounts and budget that money into your own spending/savings categories. What you're doing is giving every dollar a job.

So when you're paid the next time, assign those dollars their own jobs too.

The key in budgeting is not to be some great estimator or forecaster, it's to be aware of what you want your money to do. The key is that you make sure ALL of your money is assigned to do something -- whether it's paying the rent, buying groceries, or saving for that dream vacation. It's important to realize that when you begin assigning every one of your dollars a job, they'll begin working much harder for you. You'll be much more aware of where your money is going, and your spending will fall in line with what you truly value.

So the old question of how to budget really is answered with one simple step: Once you have a dollar in hand, give it a purpose immediately, and find peace.

About the Author:

Jesse Mecham will show you how to budget with his free 10-day course. Jesse has helped thousands find financial peace through four simple rules for budgeting.