April 12, 2020

12-Minute Financial Makeover Step 3 - Savour Freedom thru Budget Choices

Our Financial Makeover Series talks about personal finance basics and lets you figure out what applies best to your own unique situation.

In Part 1, we suggested to open a no-fee online checking account. The point is to avoid fees as much as possible, especially the devastating recurring version.

In Part 2, we talked about the pleasures of budgeting and how it can allow you to spend more on things you truly love. We proposed a no-fee savings account as one tool to organize in that fashion.

Today, we’ll talk about how budget choices can make you feel great. We hope you’ll see it can be an amazing way to exercise your freedom!

The Wonderful Power of Budget Choices

For most people, budgets are boring and restrictive. For us, our budget is fun because it helps us make wise and sometimes tough financial decisions so we can realize more of our dreams.

Try to view your budget as an essential versatile tool at the heart of each of your personal finance decisions. It’s the ultimate key to make everything work together. It’s not only about dollars and cents but rather more about dollars and sense.

As clearly as possible, your budget should be a concise representation of your financial reality and should help you manage your financial operations. Many may be afraid to face that reality and suffer from guilt. They prefer to live in denial and stick their head in the sand than to truly find out the extent of the damages.

But a budget can be the most efficient tool to know where you stand and the best way to start doing something to make things better. Your budget can give you the means to improve and help you take back power over your finances.

After retroactively accessing your present situation, an efficient budget will highlight your options to choose and can be the first step towards your financial well-being.

The objective is not to become perfect but rather to have the means to take decisions that can make things better. At worst, you’ll know more about the impacts of your financial choices.

Like we elude to in our last post of this series (Part 2), ultimately, budgeting should and can allow you to spend more money on things we truly love.

The Questionable Anti-Budget Cult

For many people, keeping a budget seems appalling. Some are even utterly against any form of budgeting. They think a budget will only limit their freedom. They prefer to let money flow.

We believe quite the opposite as we have learned that ignoring money matters could have dire consequences. We also think having a budget is a great way to exercise your freedom of choice.

In our country, money is a fact of life. If you choose not to follow your use of it, you could fall victim to it. You are probably looking for trouble is you decide to join the naïve and unrealistic anti-budget cult. If you decide not to mind it, chances are your money will only flow away.

Following your budget is kind of like taking place in the driver’s seat. You have to learn the ropes and practice to become respectably good at it. You won’t be able to go 200 miles an hour because there are some rules to respect. You may encounter dumps on the road and have accidents along the way. But at least, you’ll be in control and have better chances to safely get to your destination faster.

On the other hand, not following a budget is kind of like driving blindfolded. And unfortunately, only a rare few can develop Jedi abilities to compensate. You have the option to make budget-informed decisions or to let others and circumstances determine your faith. Undoubtedly, the use of money in our society is a convention you can not ignore.

We’re not saying you need to be obsessed about budgeting. Rather, we’re just saying that to some extent, you ought to be mindful about your money choices and take care of your own financial matters as no one will do it for you.

Get Rid of Boring and Obtain More Fun

In the end, anti-budget predispositions may only be acceptable as a compromise. For instance, you could budget a pre-set amount to cover required expenses and mindlessly spend the rest. Spending leftovers any way you like could certainly offer some level of enjoyment and a sense of staying free.

Then again, you’ll get to some version of what we already talked about in Part 2: an exciting motivating budget is all about having more pleasure.

The great thing is that a well set up budget can allow you to choose and have more of that so desired fun and pleasure.

It can also allow to slash as much as possible in the boring stuff. After all that, a good budget won’t be boring at all. It’s could be quite the opposite as it can allow you to swiftly get through things and free yourself of a lot of the boring and tedious.

Qualities of Efficient Budgets

To inspire you, we’ll now talk about the general qualities of an efficient budget that can help you make better choices and wiser financial decisions.


First and foremost, a good budget should be as realistic as possible yet conservative.

It’s not always possible and easy to set up a budget with precise figures. That’s why we conservatively estimate most budget items, especially more variable ones.

Being conservative can allow you to deal with bad surprises and have buffers to keep things in the black. So, when in doubt, stay on the safe side by inflating your estimations a little for expenses and reducing then for income.

Your Own

You’re the best person to identify your own needs and wants so your budget should be personal. There is a lot of different ways you can make your own budget work. It should only be as detailed as you want or as you need. It should give you an idea where your money is going and provide avenues to improve.

Only tracks pertinent income and expenses best suited for your situation. Adapt your budget to your situation. Sometimes, too much information or details will only be in the way and make you waste time. So, stick to relevant stuff.

For instance, you could choose to focus on discretionary spending and only follow those expenses in detail. And you could only do it for a while and stop after you feel it’s under control. The great thing is that you get to decide.

Simple and easy to maintain

To keep at it, your budget must remain somewhat simple and easy to maintain.

Even though I like to mingle a lot with ours, your budget should not take you a lot of time. In fact, an efficient straight-to-the-point budget should help you save time while easing your financial worries.

We like to stick to about 12 main categories and automate things as much as possible.

Nowadays, you can use technology and other easily accessible tools just at your fingertips to achieve so. It’s possible to almost instantaneously track down every dollar you earn and spend.


When it comes to financial matters, it’s not necessarily easy for everyone to avoid going in the red.

Keeping a budget is often the first step to avoid repetitive deficits. It allows you to analyze your earning and spending and learn from it.

Try to balance things out and avoid that dreaded red ink. As stated earlier, staying conservative can help. Over the years, we have learned to look for and now love any surplus.

Remember that no real way around the Basic Budget Equation exist. Over the long haul, your income must be greater than your expenses.


A good budget must also be flexible and adapt to your ever-evolving situation.

We’ll talk about it more next time but, buffers and a solid contingency plan are essential in these matters. A flexible budget should also account for inflation and allow efficient cash flow management.

Step 3 Homework

After your first account is up and running, most online banks also allow you to open similar accounts with just a few clicks. Because you’ve already done that in Part 2, you can easily open a savings account for a fun project.

Make sure to set up at least one but, when all is said and done, you should think about opening separate accounts for each of your exciting project.

Eventually, you could think about a period that could really be fun in your life and set up a retirement account. We’ll get back to that later in this Financial Makeover Series.

In the end, the key may be to change your mindset about budgeting. Think of how much more fun money a solid budget could offer you.

It could give yourself more freedom to spend more on what you want. Also consider that what you want may not be what you ultimately need to be truly happy.

Next time, we’ll talk about keeping cash flowing and how a contingency fund and personalized plan can help you achieve so. That insane virus-thing upon us sure is testing the most robust of these. I sincerely hope you and your family can remain safe!

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