Several weeks ago, McDonald’s caused quite the online uproar when the Practical Money Skills Budget Journal (that the company created along with partner Visa) went public. Many people criticized the budgeting expectations put forth in the journal as unrealistic.
However, one big benefit of both the McDonald’s budgeting journal and the controversy that it caused was that it got individuals and news outlets talking about household budgets.
Considering the fact that the word “budget” can send a chill up the spine of even frugal individuals, it’s high time we started talking about what budgets are (and aren’t) on a larger level. Some truly negative myths still cling to the idea of budgeting, no matter how untrue they may be.
Here are the three biggest myths that make budget seem like a bad word, and why they’re untrue:
Negative Myth #1: Budgets Are Restrictive
This is probably the biggest misconception about budgeting out there. Many people believe that going on a budget means that they’ll have to give up any and all fun spending. If the choice is between having a budget and eating ramen at home, or continuing to dine out with friends budget-free, then it seems like budgeting is definitely the worse choice.
The Truth: Budgets Set You Free
But restriction vs. freedom isn’t the actual choice presented by budgeting or not budgeting, as much as it may feel that way. Putting a budget in place just means that you’re thinking about your money choices before you make them. Many who enjoy a carefree, budget-free lifestyle find themselves out of cash before the end of the month — and forced to eat ramen anyway. There’s no reason why you can’t budget in the fun spending, and having a budget in place means you know exactly how you’ll pay for your fun without having to worry.
Negative Myth #2: You Have to Be Good at Math to Budget
Many people, remembering their struggles in high school math classes, just say “No, thank you” to the idea of having to do the calculations necessary for budgeting. It’s not that they don’t want to manage their money better — it’s that they’re sure they don’t have the skills.
The Truth: For a Successful Budget, You Only Need to Add and Subtract (If That)
Forget your fear of Mr. Medvetz’s hated algebra class. Budgeting doesn’t require any math that the average 8-year-old couldn’t handle. If you can add and subtract, then you can create a budget.
Even if you’re truly math-averse, budgeting software and apps can make creating and sticking to a budget that much simpler. Everything from Mint.com to Quicken can take the math-induced stress out of budgeting.
Negative Myth #3: Budgeting is a Huge Headache
After working hard all week, who wants to come home to even more paperwork? Those who believe this myth think that keeping a budget requires endless effort and time… and those cat videos on YouTube aren’t going to watch themselves.
The Truth: Not Having a Budget is a Bigger Headache
I’m not going to deny that the first couple of months of budgeting do take some time and effort. But it’s only some time and effort, and it gets easier and easier the longer you do it. In addition, while you do have to work on your budget, it’s infinitely less stressful than finding yourself with not enough money at the end of the month. Taking a little time now to prevent stress later is like a gift to your future self.
Have any of these budget myths kept you from budgeting in the past? How did you get past them?
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I love my budget. Lets me know exactly how much I have to “play” with. Going to Europe this weekend with that play money!
Hate to be seated going over math, but it’s the best way to have a sense of controlling your life’s path, moving from dreams into a great reality. For me budgeting is not about exact calculations. It just offers a keen understanding of present limitations so that my family can live freely within their limitations. The way I grew up is: it’s alright if we have to eat porridge (made in a variety of ways) in order to get where we want to be in life. Simply, don’t get stuck in drudgery; see the possibilities of seizing control no matter what storm is blowing through!
Back in college myth #1 kept me from budgeting, I thought at the time, budgets are such a buzz kill! Fast forward and am thinking I should have done more of it. The thing with budgeting, it can be difficult adjusting your life when you are starting out, but once you realize that it allows you to accomplish more and have a better view of your finances, it becomes part of your life.
Budget means wise thinking and the use of money over a longer period.
Many people, private companies and governments could not function without a budget.
I never really allowed them to hold me back because I started budgeting when I was in the throws of my credit card debt and wanted it to work. I hate the first myth, because I think so many get tripped up by it. It really is freeing, as long as you have the right attitude on money and don’t use a budget as a reason to spend everything you have.
I come from a long line of accountants (which explains why I’m such a hip, fun guy) so good budgeting was something my parents always did. It seems to have really paid off for them!
Love this article! I grew up in a household where my dad was an avid budgeter so it just seemed natural to me! He always says that he wants to know exactly where his money is going and wants to grow his wealth not just get by on the money he has.