Why You NEED a Written Budget

(MoneyHippo.com) – Without a system to track every place your money goes, it becomes difficult ever to get ahead or grow your wealth. People need written budgets to help them gain and keep control of their finances. Having everything planned out can give you unexpected freedom because you know where every penny is going and can adjust accordingly. Writing a budget and visiting it every few months allows you to make changes to match your evolving life.

To set up a budget, write down your monthly sources of income and every obligation you need to pay. Don’t forget to include savings in your budget for both retirement and emergencies. Build occasional expenses into your plan to account for events like birthdays, copays, holidays, and vacations, so you’re ready when those times come around.

Writing down exactly where you spend the money you earn can help you understand how you spend and prioritize, allowing you to decide whether you want to continue down that path. For example, you might decide instead of spending six dollars a day on a gourmet coffee, you’d prefer to use that money to invest or save for a vacation. Having a written budget in front of you can give you control over your financial destiny and allow you to make the most of your income.