Thursday, April 21, 2005

On Budgets--An Analogy or Two (or Six)

I've been using an analogy lately when talking to people about budgets. People seem to think using a budget is like tying up your hands and feet before jumping into shark-infested waters. If the month is going to be tough, financially, why limit yourself? Why not leave yourself completely free to use the money the way it's needed?

I'd say that's like a major-league center fielder looking at his glove and saying, "You know, this thing is really limiting me. It's got two positions--open and close. If I took this thing off, my hand would really be free to catch that ball that's hurling at me through space."

Or a carpenter who says, "You know, I keep using this hammer, and the end of this hammer is really small. I'm even missing the nails sometimes. But look at the size of the palm of my hand! I bet I'd never miss if I used that. What am I using this tiny little hammer for?"

The fact is, the budget is a tool, and like most tools, it gives you more freedom than if you didn't use it, because it gives you more power.

Budget represents your money saddled and bridled, with you firmly in control. No budget is when your money running wild and free, dragging you to all sorts of places you never expected (or really needed) to go.

I never plan to go a month of my life without a budget again. I'll never trap myself, hold myself back like that again.

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