Controlling our financial future can seem overwhelming. But Mary Hunt outlines seven simple rules to get us started on the right track. The 5th rule is about the necessity of creating a budget.
Rule #5: Tell your money where to go and then make sure it gets there.
“Whether it’s a paycheck or a trust account—whatever it is—we have money to manage. We have to see ourselves as the boss of that money. We have to think of those dollars as people who work for us as staff or employees. They come to work and you tell them what to do. You assign the job to each one and then you have to make sure that they do their job. That’s what a good manager does.”
Mary says this is the beginning of a budget. It’s important to be responsible and realistic as to what your expenses are. Once you determine where your money needs to go, stick to the plan.
“You have to assign every single dollar that comes out of your paycheck. Before you spend it, before you do anything, you need to sit down and assign each dollar a job.”
While it might feel constricting, seeing yourself as a manager of your finances is actually empowering. It gives each of us a chance to control our financial future.
“First you’ve got to figure out all the jobs. These are your expenses. What are the things you absolutely have to pay this week from that paycheck? Don’t you spend one dollar until you sit down and make these assignments.”
“You may have to put together forty five different plans until you get it all figured out but the jobs are all going to get done. Out of this will come a spending plan, and once you’ve got all of the assignments down and figure out where all the money is going to go, you are set.”
Mary says it’s important to also assign saving and giving roles to your money.
“Remember that ten percent of your employees are going to go into savings and some of them are going to be money that gets given away. So you will look at your absolute bare necessities that you have to cover just take it from there. It’s in writing. Stick to it and make sure those dollars do they have been assigned to do.”
Mary Hunt is the award-winning and bestselling author of more than 23 books, including . She is also a sought-after motivational speaker who helps men and women battle debt. She is founder and publisher of Debt-Proof Living, a highly regarded and popular consumer organization consisting of an interactive website, monthly newsletter and personal finance tools.Money Rules for Life