|Rediff India Abroad Home | All the sections|
7 secrets to making a good household budget
Sanjay Matai, Moneycontrol.com | January 15, 2007
Does the word 'budgeting' bring a frown on your face? Well...you're not alone. Most individuals dread it. Who'd like to put off buying something oh-so-irresistible today thinking about the unpredictable distant tomorrow?
But then there are quite a few who make an effort towards budgeting their finances. The sad part is it does not last for long. Some do a half-hearted attempt that serves no real purpose. And still others start enthusiastically but within a few months are back to square one. While some don't even start.
Howsoever dull budgeting may be, the end-result can be very rewarding. Here's what a good budget can do for you:
So if you're really keen on budgeting your finances here's letting out seven secrets to make it cool and enjoyable.
Secret 1: Make it a family affair
Your family members also have desires. If you do not involve them in budgeting and make it inclusive, they may not appreciate the whole process. Also, they may not understand whether something is affordable or not and may lead to an unnecessary friction.
Once everyone is involved in budgeting, it does not remain just a job to be completed. There's more committment to it.
Secret 2: Have targets
Instead, keep aside some amount from your budget for the next five to six months and buy the mobile phone out of the money you saved.
That's the way to approach budgeting. Build in interesting targets, rather than making it just an exercise of adding up your incomes and expenses. Make budgets something to look forward to with expectation. If your goal for this month is a mobile phone, next one can be plans for a playstation. An iPod can come later and so on.
Secret 3: Surprise yourself
Secret 4: Dare to do more
Challenges bring excitement to budgeting. And when you achieve success in your ventures, the feeling it brings along with is simply great.
Secret 5: Think beyond money
Therefore, think what you 'value' before you commit to any purchase, rather than trying to imitate your neighbours. Change your perception and think from 'materialistic' to 'meaningful'. Not only will this bring more peace and contentment to you, but will also improve your relations with your family members and society at large.
Secret 6: It is not a test of your mathematical skills
The idea of the budget is to broadly plan for living within your means. A few hundreds spent here or there is not going to make any significant difference to your budget. But trying to account for every penny can become mentally very taxing leading to you and your family losing all interest in budgeting.
Secret 7: Don't be too rigid
Budgets give you a defined economic freedom. It is not a financial restriction.
So let's get going. Let's get started with making our budgets and make budgeting a fun-filled and challenging exercise. Let this be one New Year resolution, you will never break.
The author, Sanjay Matai, is an investment advisor and can be reached at email@example.com
For more on financial planning, log on to click here