You will no doubt have heard a lot of tips and tricks for budgeting over the years. But which ones work and which ones are worth ignoring? Well, as you can imagine, there are certainly a lot of budgeting myths that have been conjured up over the years. These often come from old wive’s tales or outdated pieces of advice.
Are you finding it hard to sort the myths and legends from the cold hard truth? No problem; here are some of the most common budgeting myths that you can simply disregard.
Budgets Are For Those On A Low Income
Lots of people believe that you only need to create a budget if you are on a low income and struggling to make ends meet. But that couldn’t be any further from the truth! In fact, everyone should budget. If you earn enough money that you think you don’t need to worry about your finances, you should still budget as this will give you a clear insight into how much you have coming in and going out every month. You can then use these figures to see if it’s possible to save even more cash.
You Need A Very Detailed Budget
There are lots of people out there who believe that a budget only works if it is extremely detailed. Again, this isn’t the case. A budget can work even if you just include your income and main expenses. As long as you get a good overview of all your finances, you should still be able to work with your budget and use it to improve your finances.
Don’t Ever Go Over Your Budget
It is true that you should always try and stay within your budget, but that doesn’t mean there is any cause for concern if you do go over. Just don’t make a habit of it! Say one month you need to take out some credit from signature.loan, for instance. That’s perfectly fine, just remember that you now need to factor in the repayments into your next coming monthly budgets until you pay back the credit.
If Your Income Constantly Changes Don’t Budget
Some people, especially freelancers and those who are self-employed, think that there is no point in budgeting as their monthly income is constantly changing. True, it does mean budgeting will be a bit more difficult and might take a bit more time, but there really is no reason to give up on it altogether. In fact, there is probably more reason for you to budget so that you can keep a good grip on your finances. To make your budgeting easier, you need to work out your average monthly income and use that figure as a base income. Any extra that comes your way one month can go towards your savings! Just make sure that your savings are going into a useful bank account: moneysupermarket.com.
Budgeting doesn’t have to be difficult, and you shouldn’t let these myths make it any harder for you!