If creating a budget feels like a challenge, you’re not alone. There’s the work involved, which seems like it’ll probably take hours. And how do you even know how much to budget for groceries or clothing or everything else?
An even greater challenge can be on the emotional side. It just doesn’t sound like much fun. Even worse, living by a budget might feel like signing up for a life of obsessive frugality. Who wants that?
Setting the record straight
You may have to take this on faith, but a budget—or, said more positively, a cash flow plan—is the single most helpful tool available for managing money effectively. It brings clarity and peace of mind, enabling you to live generously, save and invest for future needs, and enjoy financial margin.
It isn’t even that difficult to put a budget together. You can start with paper and pencil (definitely use a pencil, not a pen) or a spreadsheet program on your computer. Put your monthly gross income at the top. Then list the amounts that you are giving, saving, and investing. From there, list all of your essential expenses (mortgage or rent, utilities, food, taxes, insurance, and the like). Lastly, list your discretionary expenses (entertainment, vacations). Try to make income minus outgo equal zero.
Taking this step alone will prove helpful. You’ll gain more awareness of how much you spend on gasoline for your car and food for your pet. And you’ll probably need to consider what tradeoffs you are willing to make in order for it to net out to zero. That’s a helpful exercise!
Drafting a budget isn’t a perfect science and it certainly isn’t a one-and-done type of activity. There will be expenses you forgot and circumstances that change. Especially once you start tracking your actual income and expenses (yes, that’s the next step), you’ll discover that the amounts you really spend each month on groceries or clothing are different than what you thought you spend.
This very imperfect process will get smoother over time. It’ll get easier. Again, you may have to take that on faith, but it truly is what people who start and stay with a budget report.
God of order
Even better, don’t just take all of this on small-f faith, take it on capital-F Faith. The Bible says, “The plans of the diligent lead to profit as surely as haste leads to poverty” (Proverbs 21:5). God’s Word encourages planning, not because God’s way of managing money is all about pinching pennies. It isn’t. The Bible encourages planning because God is all about order: “But be sure that everything is done properly and in order” (1 Corinthians 14:40, NLT).
And God is about what’s best for us. He doesn’t want us living in frustration or confusion. He wants us to live with freedom and peace of mind. Using a plan, and a budget, to manage money, will bring about a wonderful sense of order to your financial life.
One of the most foundational truths about managing money from a biblical perspective is that all of the money in your possession actually belongs to God. He has simply entrusted it to your care. Your responsibility— opportunity, really—is to manage it for His purposes according to His principles. And one of His principles is to proactively plan how to best use those resources.
If you don’t currently use a budget, you may have to take all of this on faith, and that’s fine. Take it on the small faith that using a budget won’t be like strapping a ball and chain to your ankle. Instead, it’ll bring about a refreshing new sense of financial freedom.
More importantly, take it on the capital-F Faith that God’s Word is true: “The plans of the diligent lead to profit as surely as haste leads to poverty” (Proverbs 21:5).
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Matt Bell is the author of Trusted: Preparing Your Kids for a Lifetime of God-Honoring Money Management. He speaks at churches and conferences throughout the country and writes the MattAboutMoney blog.
This article should not be considered legal, tax, or financial advice. You may wish to consult a tax or financial advisor about your individual financial situation.
