If you're in debt, you may not comprehend exactly why. It's pretty common for people who owe lots of money to not understand exactly what caused them to be in that situation. But, as somebody who has been in debt (and finally gotten out of debt), I can give you a good guess as to the reason why you're in debt.
You're in debt because you don't use a budget. It's just that simple.
I've been in debt up to my eyeballs, and it was only after I began using a budget that I was able to finally pay off my debts and stay out of debt. Others who have been in debt and gotten out of debt tell me the same thing: using a personal budget it an almost guaranteed way to get out of debt and stay out of debt.
Why is budgeting so powerful? And how can a budget help you to get out of debt?
First, a budget makes you examine the way you spend your money. A good budget will force you to look at each of your expenditures individually, categorize them, and compare the total amount you spend to how much you earn each month. There are numerous budgeting systems, and they each have a different way of accomplishing these things, but they all do basically the same thing.
Second, a budget helps you keep track of how much of your spending is in each category. This is useful when it's time to find places to cut your spending. The more you keep track of your spending, the easier it will be to spend less. Reducing how much you spend will give you more money to put towards paying off your debts.
Third, budgeting is a great way for you and your spouse to plan your financial future together. It's important that you are able to agree with each other on a "game plan" to get out of debt. If you are working on different goals, or even working at cross purposes, you'll take a lot longer to get out of debt, or you'll never get out of debt. Budgeting is a good way to work as partners, towards the same goals. You're much more effective together than separately.
Fourth, budgeting helps you to internalize the debt repayment process. By putting a budget onto paper, or into a computer program, you can more easily visualize and understand where you are in your debt repayment process.
If you're trying to track your spending habits and debt repayment progress in your head, you can't possibly do as well as with a written budget. There's something about putting numbers onto paper or computer screen that makes it seem more "real".
Fifth, using a budget will keep you motivated. By recording your progress, you can see how much better off you are now. This can get you through the discouraging times, which is vital when it comes to keeping up your momentum in the debt repayment process. - 29866
You're in debt because you don't use a budget. It's just that simple.
I've been in debt up to my eyeballs, and it was only after I began using a budget that I was able to finally pay off my debts and stay out of debt. Others who have been in debt and gotten out of debt tell me the same thing: using a personal budget it an almost guaranteed way to get out of debt and stay out of debt.
Why is budgeting so powerful? And how can a budget help you to get out of debt?
First, a budget makes you examine the way you spend your money. A good budget will force you to look at each of your expenditures individually, categorize them, and compare the total amount you spend to how much you earn each month. There are numerous budgeting systems, and they each have a different way of accomplishing these things, but they all do basically the same thing.
Second, a budget helps you keep track of how much of your spending is in each category. This is useful when it's time to find places to cut your spending. The more you keep track of your spending, the easier it will be to spend less. Reducing how much you spend will give you more money to put towards paying off your debts.
Third, budgeting is a great way for you and your spouse to plan your financial future together. It's important that you are able to agree with each other on a "game plan" to get out of debt. If you are working on different goals, or even working at cross purposes, you'll take a lot longer to get out of debt, or you'll never get out of debt. Budgeting is a good way to work as partners, towards the same goals. You're much more effective together than separately.
Fourth, budgeting helps you to internalize the debt repayment process. By putting a budget onto paper, or into a computer program, you can more easily visualize and understand where you are in your debt repayment process.
If you're trying to track your spending habits and debt repayment progress in your head, you can't possibly do as well as with a written budget. There's something about putting numbers onto paper or computer screen that makes it seem more "real".
Fifth, using a budget will keep you motivated. By recording your progress, you can see how much better off you are now. This can get you through the discouraging times, which is vital when it comes to keeping up your momentum in the debt repayment process. - 29866
About the Author:
Learn more about great ways to help pay off debt. Stop by Sean Payne's unique site where you can find out all about how to get out of debt.
