With the rise of the consumerism lifestyle today, it is becoming increasingly more important for you to start budgeting your money. This is because if you don’t manage your money well, you will end up wasting your money on things that are unnecessary, especially if you have your credit card in hand. It’s very easy to buy a product on credit, and then pay for it with lots of interests later. While there are many budgeting advice that you can follow to ease your financial management, there are some bad advice about budgeting that you shouldn’t follow at all. Here they are:
You Need To Set A Fixed Budget
It might be reasonable to set a fixed budget for your fixed salary per month, but it is not always the case. Your budget should always be flexible, meaning that it should be adjusted regularly to correspond with your real needs. However, it doesn’t mean that you can change your budget as you wish.
For instance, if you have a budget of $100 for eating out in a month, and $200 for medical fees, you might think that you must not change this budget setting. But, if you have a sudden need of $250 in medical fees, while you only have it budgeted for $200, you can always take the $50 of your eating out budget to cover the medical fees. In this way, your budget can always be adjusted to your needs, and it doesn’t need to be too rigid. As long as you can manage your priorities well, having a flexible budget is the way to go.
Buy Cheap Products Whenever Possible
Being on a budget doesn’t mean that you need to lower your quality of life. It doesn’t mean that you have to buy cheap foods, cheap products, cheap clothes, and so on. Yes, you can take advantage of discounts, but you should always avoid buying cheap products with low quality. This is because you will end up wasting a lot of money and time with these products.
For instance, instead of buying a cheap phone that will get broken in a few months, it is better for you to buy a more expensive one, which you can use for years. Cheap products will also make you more stressful, since they tend to get damaged easily, and thus, very frustrating to use.
Save Your Money Like Crazy
Being on a budget also doesn’t mean that you need to hoard money like crazy. It doesn’t mean that you have to save 80% of your income and only spend 20% of it. There is a portion that you can use to fatten your savings account, but most of the time, you have to spend most of your income to fulfill your needs, and ensure that you are living a comfortable lifestyle, while keeping your financial affairs under control. The goal of budgeting is not to save a lot of money at the end of your life. It is to manage your income so that you can make sure that you are spending your income only on things that are necessary and beneficial for you.
Those are the worst advice about budgeting that you often heard. It is better not to follow them, so that you can budget your money properly. This way, you will keep your financial affairs in a healthy condition at all times.