How often to update your new budget

One of the things people struggle with when getting a new budget started, is updating it and keeping it current.

In order for a budget to work, it cannot be automated and it cannot be glanced at on the fly between coffee and a chocolate chip muffin like advertisers of various programs want you to believe. Budgets are not conveniences or apps to use when you have a moment of free time. Some commercials will have you believe that every person who buys their monthly budget, and pays a fee for it every month, is just a happy go lucky person, whose biggest problem in budgeting is the lack of time and their product solves it by automating everything.

Well, I'm sure there are some fine apps out there that provide great budgeting tools. However.

A budget is not something that can just be treated like any other app. It should require a person, or a couple, to take at least 10 minutes a week, every week, to sit down over, look at the bank account and the budget, see where discrepancies are, make changes and updates and ensure that the finances are not only in order for this week, but will be for next week, next month and next 6 months as well. To treat a budget like any other app that one looks at briefly for a moment without seeing the long-term ramifications of spending money not part of the budget is asking for that budget to fail.

Budgeting should be work - and it should be prioritized above other work for at least 10 minutes per week, every week! I read a statistic in the 90s once that most people will spend more time on researching what to watch on television than they will devote to building their finances. Of course, television has since been replaced by the internet, but I think the same concept applies.

My budgeting tool does a few things that forces a user to look at least once a week. One, it forces you to look at your bank account and know your expenditures on your budget every week. If your bank checking account does not accurately reflect the same amount as your projected budget, there is either more money spent somewhere, which will be a problem later on if you have a week where money is really tight because you will go negative in your bank balance, or if you have more money in the bank than your budget states you should, you might have missed a payment somewhere, which will be a problem later on if you have to pay late fees on something.

Second, my budgeting tool is designed for 52 weeks out. That means, if you make a change on week 3, your budget will automatically update the rest of the 49 weeks to reflect that. If you are on a fixed income with little margin for error, for example, if you are carrying less than $1000 per day available in your account, you have to know if there is an emergency payment for 300-500 dollars for something and how that will impact your budget in 6 months or 8 months. Because right now, that $500 might be coverable, but it could potentially hurt you down the road in 3 months when you might go negative in your account. So, you have to know not only how today's budget treats you, but you have to know how your decisions of today, will impact your finances tomorrow.

Third. Almost every budget I have ever come across, and I have seen a LOT, gives you a basic accounting feature with the idea of income vs expenses at the heart of the matter assuming that you just need to know what the numbers are. However. People are not robots. A budget cannot simply give you the option to record your income vs expenses and assume everything is OK if you have more income than expenses because stuff happens. People make decisions based on emotions on a daily basis, they are not computer programs that get set in motion and just run. Budgets have to accommodate that - in order for that to happen, budgets have to have the ability to update and provide consistent data AND people have to be willing to sit down once a week and update their budgets if for no other reason, than to know for sure where they are at financially.

I am not a fan of budgeting tools where you can just set up a budget once, tie your budget to your bank account and then the budget updates for you automatically every day and puts your new spending items into categories you set up and here is why I don't like that idea. It takes away your ability to stay on top of things with your money and your accountability to yourself to stay on top of your finances!

Yes, the developers of such programs will say that it saves you time by not having to do anything, just set it and forget it... but if you just set it and forget it, you might as well not have it in the first place! If you have the luxury to forget about your daily budget, you might as well just go out there and start spending money willy nilly, because there is no way in the world you can recite how much you put aside for what category. It's not possible - it is simply too easy to bust out that debit card and just get that ... whatever... item you really want because it is only like 50 bucks. It's too easy to stray from your budget if you don't have to sit down once a week, compare it to your bank balance and record your transactions.

So to sum it up, once you get the budget set up, you have to set aside every week 10 minutes of time where you sit down in front of your computer, look at your bank balances, look at your budget and update the budget - I have a video on how I do it every week. It doesn't take a lot of time to do a weekly budget update - but you owe it to yourself to stay on top of it. Make this the last budget you have to write - and start getting on track financially once and for all. Things will happen that will throw obstacles in your path, and you have to have the tools and resources set up BEFORE they happen so you can change emergencies that will cause you heart palpitations and sleepless nights into problems that you can solve and move past.