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How To Develop Your Budget

Ah the question usually reserved for your daring moments in life, bungee jumping, sky diving, lion taming, sticking to your budget. That’s right, if you adopt and stick with a budget you will get asked this question, I can almost guarantee it. It can happen when you say no to going out with your friends because you’ve burned through your entertainment budget for the month. It can happen when you use an inheritance to pay off debt (this actually happened to us). If you stick with your budget at some point you will have to defend it, because it is incredibly counter cultural.

Are you Crazy?

We are socially programmed to spend money, it is as American as baseball, picnics, and the 4th of July. We are so used to spending money that a recent Gallup poll estimated we spend about $80 every single day on expenses other than our mortgage and other normal bills, and that only 33% of us are actually on a budget. When you talk about your budget it is statistically likely that a majority of the people you interact with can’t relate and don’t understand what you’re doing. So instead of bemoaning and being frustrated when people can’t relate, let’s talk about how to defend your budget the right way.

Share Your Rationale

If you haven’t read much on the subject of budgeting, I would suggest you read one of our very first posts about how to develop your budget. In it we highlight that the most important step in the process is to dream about what you want your budget to help you accomplish. Are you dreaming of owning your own business? Do you want to have a vacation home in the south of France? Would you like to start a foundation to support a cause you care about? Guess what, if you keep those dreams to yourself no one is going to understand why you care so much about your budget.

When you choose to eat at home rather than go out for dinner with friends, what they hear is “I’m lame, cheap, and don’t want to spend money.” When you defend your budget (by sharing the dream that goes with it) you give people the chance to hear instead “I’m choosing my dream right now.” Helping others understand what you are saving for is a great defense for your budget, it can speak for itself. Guess what, other people may even try to help you get to your dream.

Stay Humble

After you have shared the rationale for your budget it is essential that you stay humble about it. Yes you will see your mint and personal capital balances grown and grow, but you need to keep that success to yourself. The best defense for your budget is to keep it on the down low. Bring it up only on an as needed basis, it isn’t something people want to hear about often. Trust us we have been there! If you need an outlet to get the budget talk out of your system, start a blog! Better yet read our blog, you can get all of your budget talk out of your system.

Think of talking about your budget as the WMD of not spending money, only use it in extreme circumstances.

Answer Questions, Don’t Get in Arguments

When you have no other choice but to talk about your budget, remember to keep things civil. Think about the difference between a conversation and an argument, when it comes to defending your budget you should always be having conversations. Invite those who can’t understand your financial fortitude to hear why you love your budget. Use leading questions like “ask me about my budget” and “let me share why I care this.” We have all used questions like this to get someone to ask us something we want to share, this is no different. If someone asks you a question like “why are you such a tightwad” don’t respond in a similar fashion. Think of every accusatory comment as an opportunity to share your passion for budgeting.


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