Whether personally or professionally, many of us are aware we should have a budget and more importantly, stick to it. Yet, how many really do?
According to a Gallup Poll, less that two thirds of people have a personal budget and less than half of businesses do. The statistics are pretty scary, considering that you are five times more likely to meet your goals, if you choose to write them down. A budget is really a goal written down on paper, if you think about it.
If you want to reach your financial goals, maybe you should have a budget. But you already know that, so rather than rehash that side of the story, lets talk about the reasons why people don’t:
- Don’t want to know the answer – Sometimes it is easier to pretend that somehow things will just work out, whether you are in debt or whether you already know you will need more money for the future.
- Don’t want to have to say no to yourself – If you never pay attention to how much you really spend buying coffee everyday (for example), then you won’t have to feel guilty about all your little comforts.
- Don’t want to define a plan – If you tell yourself, you don’t need a plan then you never have to do the work of really thinking about where you want to spend your money or to figure out you need to make more.
- Afraid that you might fail – If there has never been a plan, then there is no chance you will fail to meet it. What would it say about you if you didn’t have the resolve or discipline to follow your own plan?
- Don’t know how – If you tell yourself that you don’t know how because it is something you didn’t learn in school, then how could you possibility expect to make a budget?
If you look at these, it boils down to two themes; I am not sure if I want to know the answer of where I am today and I don’t know how it would limit me, going forward.
Here are some thoughts in this regard. Whether we are talking about you as an individual or in your business. If you are the one afraid of where you currently are, you already know that things bad, and in your gut, you probably have some idea of the magnitude. Coming up with a number will not make it any better or worse than what you already know. There is a good chance that it might take you some work to really get your hands around the answer, but not knowing already weighs on you each and everyday.
In terms of how it might limit you, what if it didn’t. A budget is meant to focus you, not limit you. Sure, you might have to make some different decisions. Yes, you might need to look at what is really important to you. Absolutely, it will require you to see you differently, but you know that you have the things you really want to do; travel, own a home, retire and these won’t happen unless you make having this more important than the cup of coffee.
A budget is simply a tool, to help you get the focus you need, to build the business or dreams you desire. Fulfilling lives, don’t happen by chance….they happen by design, so use the tools to design yours.