The Other Half of Budgeting

Photo by: paalb

Yes, half of budgeting is tracking your spending. I know, it’s not very sexy, but at least it only takes about 2 minutes a week.

Knowing where you are spending your 95% is powerful information for finding leaks in your paychecks, adjusting future budgets, and evaluating what you value. But tracking the money you’ve spent is only half of your budget.

The other half is just as important: how much money do you have left, and what is it set aside for?

Is it where you want it?

This is the half that helps you makes sure your needs are being met, that you’re living within your means, and that you have enough to enjoy your life.

If you’re keeping things loose and flexible, you can easily do a lot with what’s left of your personal budget this month. Take a look at it really quick. Are you happy with what’s left in each category, or do you need more money for, say, food this month? If so, where will that money come from? Fun? Books?

Move some funds around if you think you should. It’s your budget.

Did you spend less on gas than you thought? Should you move some of that extra money towards short-term savings, or would you rather put some extra cash towards a fun weekend?

As long as you have enough left in your “needs” to make sure you’re good, the rest can go anywhere you think it should.

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