#17 - Budgeting Equals Freedom
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We can have anything we want but not everything we want, no matter how much money we have.
We tend to spend our money how we spend our time
Forming good habits early is best because otherwise you will always find something to spend your money on, even if it doesn't enhance your life
You need to evaluate your behavior if you want to change - can't change it, if you don't recognize it's a problem!
Best time to start having good habits is right now!! Regardless of age, you can make changes!
A budget doesn’t have to be restrictive, but is meant to put some sort of constraint on you
3-4 categories that we all know are out of control - check those first
You should be saving both in a retirement account AND outside a retirement account
Your budget actually equals financial freedom. The numbers give you the freedom to spend without guilt.
So much guilt associated with “overspending” - or simply just any spending when you’re feeling a little out of control.
Review your credit card statement - it’s fun! Make it a game! Tack it on to other habits so you can get it done and make it easy!
Tracking daily spending if you’re having issues with spending is the best way to curtail spending in places that you don’t want to.
Fixed expenses - yes these matter! If these are high, you’re going to have trouble saving (home, car, subscriptions)
Number one way to become wealthy is to manage your fixed expenses!
Plan for extras!!! Put a buffer for extra things that may come up into your budget so you're not surprised - be surprised that you saved more not that you spent more
Entitlement - this is a thought, you’re choosing entitlement
Fixed expenses hurt the most - subscriptions, regular bills, mortgage/rent
How much should I spend on my hobbies, what’s appropriate? Kind of depends!
It’s important to distinguish between a hobby and a necessity