Last month we began a four-part series of articles on money and marriage, opening up with the importance of understanding where each person in the relationship is coming from with regard to money.
This month, our focus is on knowing where you’re going financially.
The most common financial topic couples have disagreements about is how much to spend on various items. That’s why it’s essential for husbands and wives to have talked about and agreed to a plan for how they will allocate their income. A budget is the tool that enables you to do that, helping you pre-determine how much you are going to give, save, invest, and then spend on everything from clothing to vacations.
But let’s face it, for most people a budget has an image problem. People think of it as something you go on like a diet, as in, “Poor Joe and Lucy, they’re on a budget.”
In truth, using a budget actually leads to great financial freedom. Research has even shown that couples that use a budget, especially a detailed budget, are less likely to have financial disagreements.
For many couples, a budget helps foster a sense of teamwork and keeps them from overspending; for some, it gives them permission to spend more.
A friend of ours named Sheila was so frugal that her immediate answer to just about any opportunity to spend money was, “we can’t afford it.” But her husband Mike was accustomed to using a spreadsheet to monitor his spending before they got married, and they soon began using it together. Seeing their finances in black and white made Laura realize that in many situations they actually could afford it, whether “it” was a new pair of shoes or a restaurant meal. It gave her a newfound freedom with money.
On my web site is a free download on how to set up and use a budget, or as I prefer, a “cash flow plan.” If you don’t currently use a budget, give it a try. I am confident you will quickly experience this powerful truth: “The plans of the diligent lead to profit, as surely as haste leads to poverty” (Proverbs 21:5).
Do you use a budget? If so, what’s been your experience? Is it the ball & chain that non-budgeters envision? Or has it added to your sense of financial freedom?
Next month, we’ll discuss the importance of carrying no debt except a reasonable mortgage.
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A budget has been absolutely indispensable in our marriage. I can’t imagine how families and spouses live with the uncertainty of not knowing where the money is going, how much of it is floating around out there, etc. A budget tells you all of these things. And, once it’s set up, it only takes a few minutes each week to stay on top of it.
If you don’t have a budget, you have no idea the freedom you’re missing out on!
Well said, Jeff. Couldn’t agree more.
You’ve made such an important point, Matt. A budget (aka cash flow plan or spending plan) is not confining and restricting but is freedom producing! And there’s no true freedom without limits. Absence of limits leads to chaos and anarchy. The plan provides the guidelines/limits that are fredom producing. Radical thought & counter cultural but so true.
Dick – I love that line: “There’s no true freedom without limits.”