This last weekend a friend I hadn’t seen in a long time was telling me about how he and his wife are in the process of overcoming their debt. Two of his comments really struck me. He said it was a little rough getting started with a budget but that their budget has been key to communicating so that they can hit their milestones to become debt-free and that he wished he would have been aware of budgeting principles ten years ago.

On his first point, I couldn’t agree with him more. I say the same thing about wireframes and sitemaps used for designing a website. Generally the first draft is not what gets implemented. But for web design and financial success drafting a sitemap or budget gives you a document or tool that is external to your own head. Others can look at and comment and provide feedback to help refine the document. At a minimum it helps prevent (or at least reduce) disagreements that occur from people having a different understanding in mind. The external object improves each other’s understanding and ability to talk about the issues at hand.

A written budget equals communication.

Regarding my friend’s second point, that he wished he had known more about budgeting and better understood the perils of debt sooner, again, I very much agree with him. I was fortunate and was able to learn these things sooner than he did; however, I also lament that I didn’t understand sound financial principles related to budgeting and investing earlier in my life. That’s one of the reasons why I have this blog. I hope it helps somebody discover the liberation and peace that comes from controlling your money.

Now if you don’t have a written budget, get going on it. A year from now you don’t want to regret not having acted sooner, and, even more importantly, it will make life a lot better.

That’s my take. What are your two bits regarding a budget?

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