Personal budget
As a young generation, we often don’t want to worry about too many insignificant things. The question here is what do we consider as things with high importance. One of the most controversial is a budget, especially the personal one. For some people, it is very significant and may have a great positive impact on their lives but for others, it’s annoying and worth neglecting. What are pros and cons of those approaches?
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Sometimes we do hear that it’s not necessary to worry about the personal budget because we earn enough money and we often can cover all monthly costs. At the first sight, it seems to be reasonable thinking but let’s take a closer look at it. Do you know when your agreements with tv, internet, telephone providers expire? Do you try to find out what offers they can have for you? Have you ever tried to ask for a better offer and told them that market competition has better prices? Such companies often can have good offers for customers who ask because they earn enough money on people who don’t ask. The same thing concerns a bank, you can have a free account because other customers don’t care about meeting the requirements to keep it free because of one card transaction each month etc. What about shopping? Do you often prepare the shopping list which will help you buy only things that you need? It’s very important because it allows you to do the shopping for example once a week and to choose the supermarket with good prices and promotions. Also, there is often a great chance to get a loyalty card which will allow us to save more money during shopping in one store.
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I’m pretty sure that all those steps have to take some time but after a short period, it can become a very beneficial habit. Think about all the capabilities which it can give to you. You can save some money for different purposes like being able to change your job without worrying who will pay the bills, going on good holidays, being calm that in case of expensive repairs your car needs or a flat you will have that money. The first and the most important thing to start with is to write up all your monthly costs to know what your situation is. I can recommend reading a great book ‘Finansowy Ninja’ written by M. Szafranski which will help you introduce and get on the road to financial independence in the future. It changed my life and I believe that everyone should read it. After reading it, we can only wonder why such things are not taught at schools.
Thanks for reading and please share your opinion on that article with me. Here are some questions that may help you:
- Do you have and maintain your personal budget?
- Have you ever wondered about financial independence and earlier retirement?
- Do you consider saving money as a good and desirable trait or is it a shame for you?
If I were to take into account all the elements mentioned in the article, I'm forced to say that I don't keep my personal budget. I know the answers to some of the questions posed there, for example when my agreements with providers expire, I'm sure that I have very good offers compared to the average, I always plan my purchases and try to go to the most profitable stores, etc. However, when it comes to the rest and meticulous counting of every penny, I don't have time to be that precise.
ReplyDeleteI've never thought of financial independence and early retirement, I really like my current job and can easily say that I'm ready to devote myself fully to this industry. But looking far ahead, maybe I could think of becoming a freelancer or something similar. I have no plans related to this topic.
I don't think saving money is a bad thing, I think it's a good trait, provided it doesn't override anything else. Hoarding a mountain of money that you never intend to spend is pointless. It makes sense to save a certain amount each month and spend your money wisely, but you should also enjoy your life.
Thanks for commenting! Enjoying life is the most important thing to keep ourselves motivated. If you are thinking of becoming a freelancer you should better think about saving large amount of money as it's costly on the beginning ;)
Delete1. I try to manage my money within reason. I know what I spend my money on and I control the flow of my money. I set aside a certain amount of money each month for recurring expenses such as housing, food, internet, and phone. The rest of my money stays on my savings money bank account and that's where my money accumulates. The book you recommend seems to be interesting, so I will try to read it in the future.
ReplyDelete2. I have never thought about financial independence and early retirement. I haven't really looked into it yet because I'm a fairly young person who has just entered the workforce, it's hard to think about retirement and future plans here if I'm at the beginning of my career.
3. I believe that frugal people are better able to manage their budget, so they can save more money. It is much easier for such people to save a certain amount of money for a dream destination: a trip, a phone, a laptop, a car, depending on their plans for the future.
Thanks for commenting! It seems that you are a kind of frugal person and you control your budget in a good manner. I assume that you shouldn't have problems with money in the future. I understand that you're a young person but for sure it's not an obstacle to think about financial independence and early retirement. People often don't want to think about it when they are young and as a result they can only have a casual retirement - not the early one ;)
Delete1. Yes I try to track my expenses, and save as much as I can. I'm fully aware in which category (food, hobby or other) most of my money go and I'm trying to minimize unnecessary spendings as often as possible.
ReplyDelete2. To be fair, I try not to worry about it, but yes, I was thinking about becoming more financialy independend and secure my cashflow with more than one source of income. Currently I'm focused on saving, I'm glad with my current proffession and I'll cointinue to improve myself in this field. Also I'm considering having my own small business, later in life.
3. Why should I consider saving money as a bad trait? Generally speaking it is a good trait, as long as it has a goal within it. In most cases it shows financial discipline and makes people feel more secure about the future.
Thanks for commenting! It seems that we share almost the same point of view. Glad to hear that there are other young people thinking about financial independence.
DeleteFor me it is a very important topic to consider on monthly basis. Unfortunately in my line of work I do not have steady, monthly salary, which could be an issue if not managed properly. I do keep as many expenses as I can in order, but, as we know life can be sometimes unpredictable and could pose some problems with other unexpected outgoings. Often have I thought about my future and saving some money for retirement, however it is very difficult for me right now having to predict the development of my career. It could be a little frightening and probably confusing to anybody at this point. Especially, like in my case, not being particularly economically inclined. That is why I would definitely consider reading the recommended book.
ReplyDeleteThanks for commenting! Remember that every moment in life is good to make changes for better. You should read this book for sure. You'll find many interesting advises which will help you manage you budget even without stable income.
DeleteFor me it is a very important topic to consider on monthly basis. Unfortunately in my line of work I do not have steady, monthly salary, which could be an issue if not managed properly. I do keep as many expenses as I can in order, but, as we know life can be sometimes unpredictable and could pose some problems with other unexpected outgoings. Often have I thought about my future and saving some money for retirement, however it is very difficult for me right now having to predict the development of my career. It could be a little frightening and probably confusing to anybody at this point. Especially, like in my case, not being particularly economically inclined. That is why I would definitely consider reading the recommended book.
ReplyDeleteThanks for commenting! Remember that every moment in life is good to make changes for better. You should read this book for sure. You'll find many interesting advises which will help you manage you budget even without stable income.
DeleteDo you have and maintain your personal budget?
ReplyDeleteYes, I have spreadsheet with all income and expenses, and all buing decisions are driven by analysis of data from that spreadsheet.
Have you ever wondered about financial independence and earlier retirement?
Not yet, but as soon as I will fix my finances I will
Do you consider saving money as a good and desirable trait or is it a shame for you?
Of course it is desirable trait, but not many people in Poland can afford to use about 20% of income to relocate this founds on saving account - I read some economic article that 20% of income is optimal amount for saving
Thanks for commenting! Wow, the spreadsheet with expenses is the one of the topics that is mentioned in the book I've recommended. For sure you're on a good way in budget management but I think that you can find also more advises there.
Delete1. I have my personal budget, I monitor vast majority of my expences, such as all the bills, food, education, vacations, car repairs. For me personally, excel does it's job perfectly.
ReplyDelete2. Financial independence comes to my mind from time to time, but to be honest now I have plenty of things besides finances to take care of.
3. Of course I see saving money as a good habit. Actually, I have never seen taking care of my money as a shame, either I have plenty of money or just from one paycheck to another.
Yes, I have and maintain my personal budget. In order to be persistent with maintaining my personal budget I made an Excel document in which I included all my fixed and variable expenses and each month I work with that document to draw some conclusions on how I spend my money.
ReplyDeleteYes, I have wondered about my financial independence and earlier retirement, that is why I’m very concerned about my savings and all my expenses. I also am trying to work very hard right now to be able to earn enough money to ensure my financial independence in the future.
I consider saving money as a good and desirable trait, because that simply is a smart thing to do. Our future depends on us and it is our responsibility only how our future life is going to look like and how much we can prepare ourselves for any life circumstances.
Thanks for commenting! Wow once again. I'm pretty surprised that another young person has the excel with outcomes in order to maintain the personal budget. It seems that young generation may have good life in the future.
DeleteYes, i do have and maintain my personal budget. I follow all steps mentioned in article, on top of that to save money i always put change after any payment to piggybank. Try it and after month you will see quite nice amount of saved cash. I completely do not trust our national pension system and if i would not save enough money for my retirement im more than sure that i will never see anything sent to my account from "ZUS". No, for sure saving money isnt shame. Its one of best habbits you have. No, for sure saving money isn’t shame. Its one of best habits you can have. Only smart people know that the only person they can relay on is themself. Parents taught me that if i want to achieve anything in my life i need to start from the very beginning, thats why as of my first salary i started to save money.
ReplyDeleteThanks for commenting and for the advice! I share your opinion about 'ZUS' I also assume that I won't get any money from them and the only retirement I can have is the one that I'll build on my own.
DeleteI've been trying to plan my monthly budget for basic expenses for some time – mostly for daily expanses, hobbies and education. I believe that planning daily expanses allows me to control what I buy and protects us against unconsidered purchases. Planning a budget - for example for grocery shopping also helps me to reduce the amount of food wasted.
ReplyDeleteTo be honest I’ve wondered about financial independence and earlier retirement since I watch a funny video created by Make Life Harder about retirement’s vairiants. This way of retirement was called “Norwegian variant” ;)
I consider saving money as a good and desirable trait as long as it is healthy way. Sometimes it is a thin line between being frugal and mean.
Thanks for commenting and video recommendation! I agree with you that we have to be aware that this line is thin and we have to be open minded all the time.
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