How I Plan To Create A Better Budget

Goal setting is an annual exercise as we try to whip our home and other fiscal assets into better shape. And so we crunch numbers and try to tone up our financial abs.

But like a new diet or workout resolutions, goal-setting efforts can be exercises in futility. That’s because improper or poorly planned budgets can leave us feeling winded and strained. So I’ve spent some time trying to think about the shortfalls and possible solutions.

Here are my lists of pitfalls:

• Failure to look back. We need to check in before pushing forward. How much was saved last year? Where did the money go? How did we waste money? What speed bumps and roadblocks appeared in the past 12 months? What home expenses are likely to appear in the future?
• Ignoring weaknesses. I hate doing sit-ups, I’m scared of free weights and I detest push-ups. But if I want a jiggle-free body, those exercises must be included in the fitness program. Likewise, financially I need to accurately assess spending weaknesses and find a plan that will address those sore spots.
• Unrealistic targets. Why train for a marathon when it’s hard to run a mile? A good fitness program begins with baby steps. We should use that same philosophy with fiscal goals and aim for modest, but doable savings targets. Otherwise, financial resolutions can crumble under the weight of trying to do too much too soon.
• Comparison tests. I have wasted time and energy by watching the training progress of others. Comparisons are draining exercises that throw me off track and lower the resources in my personal account. I have to learn to track my own numbers. That pace is enough to keep me busy for the next 12 months.

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