LIVING ON A BUDGET
(3rd of 3 parts)
See link for 1st part: https://www.wei2success.com/consciousness-on-your-savings-ratio1-of-3/
See link for 2nd part: https://www.wei2success.com/grow-your-savings-ratio-2-of-3/
How do you improve your savings ratio consistently over time?
One way is to learn how to live on a budget. A budget is your weekly strategy on how you will finish well for the month. It is how you appropriate your income to your everyday expenses. It is the ceiling you put to the amount of expenses like transportation, food, and recreation.
Living on a budget does not mean that you will deprive yourself of what you value most. It means that you will cut the costs of those which is of little or no value to you so that you can have more for what you value most.
For instance, let us say you immensely enjoy traveling. You are rejuvenated when you are resting in the beach. You are renewed when you smell the aroma of green fields and fresh air. You marvel at the different cultures of the places you visit. Does living on a budget means foregoing all these? Not at all. This is essential to your wellness. It is your way to unlock your recovery mode. You need not deprive yourself of this.
You will now look at your other expenses that do not give value to you and to your life? Do you eat out often? Is this important for you? Do you frequent the movies? Or concerts? Does it give you the same satisfaction as travelling? Once you have identified the less satisfying items in your budget, those that does not make your life more meaningful and satisfying, you may cut on these items and maintain your budget for the one you truly like and at the same time build up on your capital.
Living in a budget means knowing how much you are to appropriate for your operational cost. Your operational costs are things you need to pay for every single month that you continue to live. You cannot live decently without paying for these obligations.
These operational costs may be divided into three types: fixed, fixed-variable, and variable. There are elements in your budget that is somehow fixed. It is not unexpected cost. Neither it is an emergency cost. Monthly, you know that you will incur this, like rent, transportation, amortization, insurance expense. There are also fixed-variable. Those items, which you need to consistently pay, month in and month out, whose amount varies depending on how much you used it. Your utilities are an example. Variable cost are items in your day to day living which may exist or not. You cannot predict how much you spend on these items. Examples are repair cost, medicines and gifts or tokens.
What is the largest amount that you can pay on these operational costs? Living on a budget is putting a ceiling amount on these items and persevering everyday to keep it. Doing so will still allow you to still have your desired surplus in your income or your desired savings ratio at the end of the month.
Living on a budget is not for the faint hearted. It is not easy but the good news is it can be done. This is one way to improve your savings ratio over time.
Purposely putting your thoughts and actions in harmony with how you want to grow. Let us say you want to grow in the area of building your wealth.
You want to build your wealth. Then be ready to watch and look out for your savings ratio.
Do you want to travel and discover the beauty of the world?
Do you want to leave your apartment and have your own home?
Do you want to have a business when you retire from work?
Do you want to take graduate studies abroad?
Do you want to improve your life?
If you want to grow in areas of your life, then you must be intentional.
-Charmz Bautista
Wealth Engineering Institure (WEI2SUCCESS INC,)
Want a FREE workbook on “How to Build Your Personal Wealth“?
visit the link below: http://www.wei2success.com/financialfreedom/sign-up/