13
Oct
2022
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7 Steps of Budget Planning to Avoid Financial Disasters

What Are the Purpose of Budgets? Find Out in These 7 Steps

What Are The Purpose of Budgets, The First Step 

It is important to ask yourself, “what are the purpose of budgets” before buying anything costly. It starts with understanding how to buy the big stuff, such as cars and homes. Not asking the question, “what are the purpose of budgets” is one of the biggest reasons many cannot withstand a small business or personal financial disaster. Budgets are king when it comes to financial success. 

Many of us forget that there are affordable ways to buy homes and cars to avoid future financial disasters. What happens is that these two items are based on way too much emotional buying. Keep your head on straight by researching before you purchase. Learn more on my Instagram

Ask questions like; Do I really need a new car? What will the warranty maintenance cost of my new car be? What if I purchase the same car at 3-4 years old? What would the savings be?

If you have a job, no matter how secure you think you are, that security could be in jeopardy at any time. So, purchasing a car that you can buy in cash or with very low payments will be the better option.

The same holds true with a home. If it is too large, with a stressful payment, the smaller home with the lower payment, that carries less stress, maybe a better option. Develop a budget plan printable, so you can update your budget as circumstances change. Create your own budget planner book with your budget planner printable for lasting budgets. 

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What to Cover in Your Budget Planner Book

The second step to answering the question, “what are the purpose of budgets” when creating your budget planner book, is to focus on the short-term as well as the long-term budgeting success. But, sometimes, people with a home and car let important insurance lapse due to illness or thinking they don’t have the time.

Don’t allow simple negligence to destroy your budgeting success. Your budget plan printable and budget planner book should have the schedule of all urgent payments. 

Stay fully insured with a car, home, health, life, and, if you own a business – all applicable business insurance. A small business lawsuit should always be covered with business liability insurance, not your personal assets –  so don’t take the chance.

Don’t Waste When Times are Good, Create a Budget Plan Printable 

Create a budget plan printable that moves with the times. We have had many economic downturns and upturns in the past several decades. The one regret I have heard a lot when I talk to people who make a lot of money when times are good is — “I lost my mind when I had a lot of money. Spend without regard to the reality of the future, and then a financial disaster can come.” Sticking to budget plan printables will avoid this catastrophe. 

Because nothing is guaranteed, even good times, it is important to handle your money as if the money will stop anytime; that will help protect your assets.

"What are the purpose of budgets?" before buying anything costly.  How to use a budget planner book with a budget planner printable.

Let Your Kids know Money Doesn’t Grow on Trees.

There are some parents who, despite much evidence to the contrary, feel it is important their kids need to have all the material trapping they did not have. It is not necessary, and it is not true.

Your kids will literally begin to think that money grows on trees and drops from the sky. Your kids know you love them when you give them positive time and attention, so it is not necessary to spoil them, and it may lead to a financial disaster.

You can reward them without giving them too much, some parents to the tune of going bankrupt. At this point, your kids probably are not aware of potential financial disasters, but at least you can start to teach them money skills.

Have a Sick Fund for Days Not Covered by Extended Illness

Most jobs have sick leave; most small businesses have no sick leave unless they create it themselves. As an employee, you may run out of sick leave if you have an extended illness. Save money in a sick fund to cover an extended illness. This is especially important for small business owners.

Make Your Savings a Bill

Create a general savings fund and treat it like a bill. You probably see a pattern here. Saving money on several bills is just as important as paying existing bills. It should be a part of a general budget plan for financial disasters.

Don’t Borrow From Your 401k; borrow From Your General Savings

As far as I am concerned, borrowing from a 401k is a budget-planning financial disaster unless you are suffering from a fatal illness; borrowing from your 401k should not be a consideration.

You should have an automatic saving account for financial disasters that you can borrow from.

The seven steps of budget planning to avoid financial disasters will above get you on the way to solid financial success.

Do You Need a Budget That Works and it Last?
Use This Simple, Easy, and Magnificently Organized Budget Planner
How to use a budget planner book with a budget planner printable.

Lois Center-Shabazz| Money Strategist | Course Delta Agency

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What Are the Purpose of Budgets? Find Out in These 7 Steps

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11 Responses

  1. Pingback : Powerful Positive Money Affirmations to Change Your Life Forever

  2. Prisca Benson

    Great tips! Way to empower people to take charge of their finances. Planning is the best buffer against unexpected circumstances.

  3. Sheri Hoff

    I love the – make your savings a bill tip. We pay our bills, so of course if we think savings is an obligation like that, it becomes a priority. Nice post:)

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