There is one budget that is the most popular of all. I won’t name what it is quite yet because I want to see if you can guess what it is. It is the worst budget of all yet it is the most popular, at least here in America. So let’s get to why it sucks and let’s see if you can guess what it is.
Unexpected Emergencies Sink You
You need a new car tire because you just got a flat, but this budget won’t have that built in. Instead you’re going to be scrambling for money or might have to do something worse and incur debt. These expenses are predictable because emergencies will always hit when you are least prepared. On top of that, a flat tire isn’t a true emergency as you knew you’d need new tires eventually, but those weren’t accounted for in this budget either.
What would happen with a real emergency? You lost your job but you don’t have an emergency fund to use in situations like these… ouch. Sounds like you’re going to be dealing with the next problem of this budget.
Your Debt Will Continue Increasing Unless You Change
These mini emergencies (and non emergencies) will keep popping up and chances are you’re going to go into debt to pay for them. You’ll start paying it off, then another emergency will pop up and you’ll have to add more to that debt and the vicious cycle will continue. You won’t get anywhere unless you change.
Then there are those times where you feel like you’ve been working really hard and you deserve something even though the money isn’t there… but it is OK because you’ll be getting paid soon so you’ll just put it on the credit card until the next influx of money. Dangerous path my friend. Don’t go down it. Chances are, if you’re on this budget, you will go down that path. Another strike against the most popular budget.
You Never Save Any Money
If you’re on this budget it isn’t likely you’ll be saving any money. See, this budget doesn’t worry about saving because you’ll be able to do that later in life. This is how people on this budget justify it, even though it your future isn’t any brighter. On top of that, you’re too busy dealing with the little emergencies that pop up that there isn’t really any way you could see yourself saving anyway. There are more important things to be doing today to enjoy life because you only live once!
Your Present is Brighter Than Your Future
That’s because on this budget you’re spending almost all of your money (or more money than you really have) making your present brighter. The problem is that your future gets dimmer with every extra dollar you spend making your present brighter.
You spend your future dollars to make yourself feel better today and then tomorrow doesn’t feel quite as good. You then spend even more of your future money and you become doomed with a massive debt load you can’t pay back. This is the grim future of many American’s today because they are on the most popular budget.
What is This Mystery Most Popular Budget?
Hopefully you have guessed by now that I’m talking about the paycheck to paycheck budget. Some will argue it isn’t even a budget, but it really is. People plan what bills come out of each paycheck each month so that they can successfully make it to the next month and next set of paychecks without running out of money. The problem with this budget is you’re stuck in an endless cycle and will likely spend every penny waiting for your next paycheck.
Escape the paycheck to paycheck budget and come up with a real budget that allows for you to save money and escape this vicious cycle. It’ll be tough in the beginning but you’ll see your future getting brighter with every dollar you save. Soon these emergencies won’t have you hoping you’re next paycheck is only a couple days away because you’ll be able to pay for them out of your savings. It is a wonderful feeling!
Have you ever been on the paycheck to paycheck budget? What is your advice to help people escape the pain? Do you agree that the most popular budget, the paycheck to paycheck budget, is the worst budget?