Life is full of tasks that initially seem unenjoyable and of little value. However, they often provide long-term benefits we may not appreciate at the time. Regularly going to the dentist is a good example. No one really enjoys the process, but your long-term dental health is worth the hassle. Who looks forward to rotating tires? No one, probably, but doing so will extend the life of your tires and save you money in the long run.
Many would classify preparing a monthly budget, as a thankless, unenjoyable task. If you’re not a budget-er, it may be hard to see the benefits of creating one every month. However, for those of us who prepare one faithfully, we can’t imagine starting the month without a spending plan in place.
So, what are the benefits of taking the time to create a budget each and every month? Here are a few to consider.
God instructs us to do so.
To be sure, budgeting is not a salvation issue. Still, God has advised us to plan ahead. Jesus said in Luke 14:28, “Suppose one of you wants to build a tower. Won’t you first sit down and estimate the cost to see if you have enough money to complete it?” This admonition doesn’t apply to just building towers. We are to be stewards of all the resources He has blessed us with, even down to the smallest expenditure. This doesn’t mean that we can’t treat ourselves to a fun purchase, vacation, hobby or other “want” we desire. It just means we need to plan for it. Quite frankly, as a Christian, this should be enough encouragement to adopt some sort of plan for your spending.
It helps natural spenders to save, and natural savers to spend.
Each of us is wired differently. If you found a forgotten $100 bill in your coat pocket, some would want to spend the found money on a surprise treat, while others would see it as an opportunity to add it to the emergency fund. Neither is inherently right or wrong, just different. A monthly budget allows the natural saver to more easily spend because they know that saving is also occurring. Likewise, the natural spender more easily saves knowing that they will also be able to enjoy the lattes they crave.
It creates accountability for married couples.
The budgeting process should be a joint effort, not something prepared by one spouse and imposed on the other. Many married couples that I’ve counseled have commented on how the budgeting process actually strengthened their marriage as they learned more about how their mate thought about money and worked together to meet both of their needs.
It helps you meet your short and long-term goals.
A monthly budget helps to make sure that an appropriate amount of funds are set aside for your goals each month. Waiting until the end of the month, hoping that something is left over, is no way to meet these goals in a timely manner. Whether saving for next year’s vacation or for retirement several decades from now, a budget will help ensure something is set aside each month for your financial goals.
A budget will expose your bad spending habits.
Most of us have spending weak spots of some type. Whether it’s eating out a little too often, or downloading a few too many songs, a spending plan will shine a light on those areas and give us the opportunity to change them.
It increases your financial peace of mind.
Wouldn’t your vacation be more enjoyable and less stressful if you didn’t have to worry about how you were going to pay for it when you get home? Or, how much more comfortable would you feel knowing that you had a fully-funded emergency fund when (not if) an unexpected bill arrives? Matthew 6:34 tells us to not worry about tomorrow. Good advice, to be sure. Maybe God’s plan for you to deal with financial worry is to take His advice from Luke 14:28 and create a plan in advance. Don’t increase tomorrow’s uncertainty by not planning for it today.
It helps you avoid debt.
One of the most common causes of unplanned debt is from a lack of budgeting. The unexpected medical bill may be paid with a credit card if there is no emergency fund already funded. A car replacement may need to come with a payment book because some money wasn’t set aside each month over the last few years in anticipation of the need. Or, you and your child may be strapped with student loan payments for decades because money wasn’t set aside for college as they were growing up.
Creating a monthly budget doesn’t have to be a time-consuming and complicated process. My wife and I still prepare one each month with paper and pencil in only a few minutes. There is a learning curve, so show you and your spouse some grace as you begin the process of budgeting. Most of us are bad at budgeting when we first begin, but commit to it for at least 90 to 120 days. If you stick with it, the long-term benefits are worth every minute spent as we strive to become the stewards God calls us to be.
John Madison is author of “The Steward Plan,” a Certified Public Accountant, and founder of Dayspring Financial Ministry. He earned a Master’s Degree in Personal Financial Planning (MSPFP), as well as the Master Planner Advanced Studies (MPAS), CRPC (Chartered Retirement Planning Counselor) and AWMA (Accredited Wealth Management Advisor) designations. He has been featured in the New York Post, Forbes, Crosswalk, The Christian Post, Charisma Leader, Chicago Tribune, U.S. News and World Report, Bankrate.com, CNBC.com, among many other media outlets. For more information, visit http://www.dayspringfm.com.