The extra work involved in tracking and monitoring spending can seem overwhelming, but every time we miss an opportunity to ask additional questions or verify an expense, we run the risk of losing more money.
An example is a friend of mine who watches her Internet and cable bill with an eagle eye. She notices when the "Miscellaneous Fees" or the cable package fees suddenly increase, and she calls and asks questions. Later her bill is reduced because the expense was an error. But, if decided not to call this expense is billed each month.
We don't have to stress over expenses, be aware of what's driving your spending. My Mastering Your Money Plan course educates others on how to make your budget work for you. Budgets should not be restrictive but used as a tool to enlighten individuals on spending and saving.
Savings help to build a cushion for the future.
1/5 or 5% to 10% of income will go a long way during years of recession or slow months in business or work seasons. While working for a community college, I learned a technique to save money when income is high to prepare for the slow seasons. Seasonal employees such as teachers, have the school pay them a certain amount of money for ten months. The teachers can elect to have the college to reserve a portion of their salaries for the other two months of the year for when they are not working. A little out of each check to prepare for the future.
I decided to expand on this theory by researching biblical principles. God told Joseph to save 1/5 for the dry seasons. God plans to have us prepare for the future.
Retained Earnings is the accounting profession term for reinvestment into your business. Savings will allow for money to be reserved for future business purchases or operations. Where are you with planning and prepping? Creative spending or spending by feeling usually leads to an empty bank account. Let's talk and see where you can get started with your budgeting.