Budgeting: The Financial Diet
Budgeting is like being on a diet. Although you may not realize it, a diet is just a fancy term for eating patterns. Society has coined diets to be weight loss eating techniques; everyone technically has a diet because they eat a certain amount of food each day and know how to maintain a healthy body. Just as with your diet, budgeting is the way you choose to spend your money. With that said, when there are 50 cookies in your kitchen you don’t just eat every single one since they are available. The same goes for finances, having $50 in your bank account doesn’t mean you should immediately go spend it on an impulse buy or something you want but really don’t need.
I started out my freshman year at Lawrence Tech with no personal financial commitments and a savings account full of graduation money. My parents agreed to assist me with my tuition, so all I had to do was buy any supplies for my dorm that were not necessities and get settled in with my roommates. The first week after moving in I took several trips to the store in efforts to make my dorm homey for the next year. I went out on several occasions with my new roommates to bond with them. Over the first couple of weeks at Lawrence Tech, I had spent much more than I probably would have if I really sat down and made a budget. This money could have easily been saved for future needs.
Without a structured budget, impulse buys can easily happen. Granted, I needed most of the items I purchased for my dorm. However I could have easily budgeted and bought the items in phases while looking for deals. The items were not an urgent need and I really felt bad when I noticed how fast I had drained that portion of my graduation money. Having even a loose budget would have helped me understand how I could have better spent my money. In the same way that my own “diet” is loose and allows me to eat whatever I want within reason, my budget can be flexible too!
As I am in college without house payments, loan payments, and other bills I can easily manipulate my budget to accommodate occasional nights out with friends and personal purchases. However, knowing that someday I will have all of these financial commitments, I budget to save as much money as I can to be prepared.
Another fun thing I am budgeting for is my senior year spring break, which I decided to start saving for a few months ago. Knowing that I had about a year to save up, I made a plan to save a certain portion of each paycheck towards my trip. By saving money in advance with smaller amounts, my goal becomes more achievable. Think of an overweight person trying to lose weight. A weight loss goal of one pound per week for 50 weeks is more achievable than a goal of ten pounds a week for five weeks. Knowing what is achievable for your own financial situation helps when making your budget.
Once you set a budget for yourself and practice it, you will find it to be quite an easy task. Budgets are allowed to be flexible and fun to fit your personal lifestyle. They also should be customized, just because it works for your best friend doesn’t mean it will work for you. Also don’t be afraid to change your budget if it isn’t working for you. I’ve had several budgets throughout my time at Lawrence Tech. Each small change in my life can reflect in a change in my budget, depending on my needs.
Until next time,