You Need a Budget: The Proven System for Breaking the Paycheck to Paycheck Cycle, Getting Out of Debt, and Living the Life You Want

by Jesse Mecham

In truth, when we’re stressed about our finances, it’s because we’re not sure our money decisions are aligned with the life we want to be living.

The question we need to ask ourselves isn’t Can I? or Should I? It’s What do I want my money to do for me?

What do I want my money to do for me? works like a gut check that helps us see whether our priorities are driving our money decisions. When we know what we want our money to do for us, the options become a lot less daunting, and confidence quickly replaces the stress.

What do I want my money to do for me? is about nothing less than deciding what kind of life you want to live, and then making a plan so your money can help you get there.

the point is to decide what your priorities are, and then make a plan to meet them.

That’s the beauty of a (good) budget: it lets you see exactly how your spending affects the rest of your life.

Rule One: Give Every Dollar a Job, is all about being proactive, so life doesn’t simply claim your money.

Rule Two: Embrace Your True Expenses, combines the power of thinking ahead with taking action here and now. Whether expenses happen like clockwork (rent), feel impossible to predict (car repairs), or are just far-off dreams (cash for a wedding), they are all part of your true expenses. The key is to prepare a bit at a time by treating them all like monthly expenses.

Rule Three: Roll with the Punches, helps you adapt so you can handle whatever comes your way. Your budget is a plan—but plans change, and your budget should, too.

Rule Four: Age Your Money, gets you working toward spending money you earned at least thirty days ago.

• Rule One: Give Every Dollar a Job • Rule Two: Embrace Your True Expenses • Rule Three: Roll with the Punches • Rule Four: Age Your Money

If guilt haunts you it’s usually because: 1. You know in your gut that a bigger priority needs more of your attention; or 2. You’re letting other people’s expectations of how you should live your life color your choices.

Forget future money; use today’s money to write your future.

Fund your true expenses first. There’s no use in dumping all your cash into debt payments if it will leave you broke when new bills come in. True expenses are especially tricky when you leave yourself little cash. One surprise bill or expense, and you’ll slide back into debt.

Treat your child’s allowance as a tool for learning. Keep it consistent and keep it separate from any of their other responsibilities.

Teaching your kids to be smart with money is one of the greatest gifts you can give them.