Updated: Sep 22, 2020
If you have never tried budgeting before, it can become easy to believe some the most common myths it has. Most times people learn about finances from watching others and from what has happened with their past experiences. The issue with learning how to manage your funds from watching other, is that someone else's financial journey from the outside looking in will most likely give you a false representation of how personal finances actually work. Here are the top budgeting myths you should unlearn:
Myth 1: Budgeting requires a lot of money
Stop waiting for more money to get serious about what you have.
No matter how much money you make each month, budgeting what you have will give you more discipline, knowledge, and power to increase your retained income.
Myth 2: You only need to create a budget once
Budgeting is a habit
Creating a budget should happen at least once a month, because your financial wants and needs change over time, and your budget should be reconfigured to reflect those changes.
Myth 3: You have to be good at math to budget
Budgeting requires basic math skills such as addition and subtraction
The math you learned in elementary school should be all the math you need to create your own budgets. For the more detailed budgets, math including multiplication, division, and percentages can be used.
Myth 4: Budgeting only works with a fixed income
Any income style can support a budget plan
The true beauty of budgeting is the flexibility and customization that it comes with. If your income is irregular from month-to-month, I recommend creating a budget every time you get paid, to properly adjust your budget plan to work within the means of your new income level.
Myth 5: Budgeting takes up a lot of time
A budget should not take more than an hour to do
If you scroll on social media 6 times throughout the day for 10 minutes each, you spent an hour of your time that could have been dedicated to getting your money in order. One hour a month will ensure your finances are doing what you want them do. Once you get the hang of creating budgets, it can take anywhere between 15 and 30 minutes to complete. The more complex your personal finances are, the longer it can take to customize your budget.
Myth 6: Budgeting will make you a cheap-o
Budgeting makes sure you are living within your means
Just because you create a budget for your finances and want to cut down on your expenses does not mean you automatically become a cheap-o. Budgeting is about being smart with your money, maximizing the utility of your income, and having a plan for what have.
Myth 7: Budgeting is the answer to all your financial problems
A budget is only a plan that must require follow-through in order to be successful.
Just because you make a plan for your money each month does not guarantee that all your financial problems will vanish. Budgeting also requires that you are consistent, discipline, and conscious of your spending habits.
Myth 8: Budgeting is too complicated
There are only 4 simple steps to creating a budget
Budgeting can seem daunting at first without proper explanation, but I recommend reading my previous blog post "Steps to Achieving Your Perfect Budget" to get a better insight on just how easy it really is.
Myth 9: Budgeting is boring
Find ways to make budgeting fun
Budgeting is a goal-oriented process that can be rewarding and enriching as you go along your financial journey. Set realistic goals for yourself and when you complete them, you can structure a reward system to keep yourself motivated.
Myth 10: You don't need a budget
Any and every person making money can benefit from having a budget
Budgeting is not limited to a specific group of individuals who "need" it, and if done correctly, it cannot effect your finances in a negative way. Having a budget for your income is like having a plan for your future; it never hurts to have a plan. Think about which myths you have been holding on to for a while and what led you to believe them. Afterwards, transform your perspective on budgeting and let the myths go. Now is your time to reclaim control over your financial future and learning how to budget your finances is just 1 step of the process.