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B is for Budgeting

Definition of Budgeting: generally refers to creating a plan of all planned expenses and incomes.

I know some people who hate the dreaded ‘B’ word but budgeting is actually a wealth secret because if you don’t know where you are now how can you plan how to get where you want to be? If I asked you to tell me how to get to New York you’d probably ask where are you starting from since your instructions would be very different if I was travelling from London or from Sydney.

So budgeting is a way of knowing where you are now financially by listing ALL your expenses and all your income. I stress the ALLyour expenses because most people know their income but they don’t know ALL their expenses. So I mean even including the coffee you may buy at the local coffee shop or the magazines you buy when going into a shop – everything. It’sonly when you are aware of your income and all your expenses that you can make choices about how you spend your money.

Some people do jobs they don’t particularly like but still have no real idea where their money goes. If you’ve worked hard for your money (or even if you haven’t), you want to make choices that suit you and your goals. I would say that part of your budget could include what you want for your life since knowing why you are doing something can help if times get tough.

So list all your income and expenses. I like to use a spreadsheet but you can use pen and paper or whatever you prefer. I know you may have it in your head but put it all down where you can see it. That’s when you can go through everything and really choose where you want to spend your money. If you choose to spend x amount on a magazine every week as long as you realize that’s your choice then that’s okay.

You can create categories for your expenses such as rent (or mortgage), groceries, bills etc. Some people simply use categories or essential and non-essential. If you are paid in cash you can set up jars or envelopes and split out your wages when you get paid. If you are paid into a bank account you can have a separate account for your essential payments (just be careful with bank fees).

Attracting wealth is not about focusing on what you don’t have but focusing on what you could have. If you have created a tight budget know that it’s for now and not forever. Remember that part of a budget is income so if your income is not as great as you would like think how could you earn extra money? What skills do you have? What hobbies do you have? Think about ways you could use your skills and hobbies to create products or services for other people. People pay to have their problems solved so what problems can you solve? What would your wealth success look like to you? Be open to new ideas.

Remember the last article on abundance - there are enormous rivers of money flowing around the world. How would you like yours to be delivered to you?

Wealth Quote: “There are plenty of ways to get ahead. The first is so basic I’m almost embarrassed to say it: spend less than you earn.” Paul Clitheroe