Smart Money Habits Series: 3 Simple Steps To Start Reconciling Your Budget Today!

Budget Divas

In this series we’ll be talking about good old-fashioned money habits that we need to revisit from the generations before us. The same good old-fashioned money tips that our parents, grandparents, and even great-grandparents used in their everyday life.

People want that magic pill that is going to take away all their problems. But let’s be honest here. Imagine for a second, someone that is not very good at money and they were given $50,000 to pay off their credit cards. And lets just say they did – they actually deposited that check, went online to pay off that bill, and was now completely debt-free.

Now, this person has a pretty decent income but has not learned how to manage their money correctly. In your opinion, do you think that person will be back into debt in the near future?

If you answered yes, I completely agree with you.

It’s interesting because when I hear stories on social media, the first thing that comes to mind is “if only there was a magic wand that could completely wipe out my debt, I’d have a clean slate and I’d be better off.”

But most times, that is not the case at all. Think about this for a second. There are so many diet fads out there that promote this magic pill that will instantly help you to lose weight, curb your appetite, and make you eat less. these diets may lead to rapid weight loss in the short term, they are not sustainable over the long term. But what happens once they stop taking that magic pill? Many people end up going back to their previous eating habits once they stop following the diet, which can cause them to regain the weight they lost or even gain more weight than before. We hear stories like this ALL the time and that’s why they call it fad dieting.

When I talk to people and ask them what keeps them up at night, the most common response I hear is - My spouse/partner and I make a really good income but we don’t know where our money is going. It seems like money comes into the account and goes right back out and we don’t have any money until the next paycheck.

The short answer is the fortune is in the follow-up. This term is widely used in business but has the same effect when we apply it to money habits. If you create a budget and don’t look at it again until the next month, that budget is no good to you at all. You are pretty much left with a pretty template that you downloaded online with your budgeted numbers in it.

The first habit to becoming good with money is to reconcile your budget. Reconciling your budget involves comparing your actual income and expenses to the budget that you have set for yourself, identifying any discrepancies, and adjusting your spending or saving habits accordingly.

I’m going to give you three easy steps you can do right now:

1) Pick a day and time that you will reconcile your budget

2) Dedicate a space for your monthly receipts

3) Go through your receipts and only keep the current month’s personal spending receipts in that dedicated space

Stay tuned because in the next podcast, I’m going to tell you step-by-step on how to reconcile your budget so that you can get it down to one hour per week. Until next time, keep moving forwa

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