Investing in Philippines: Ways to be debt free: Let's talk about budget

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Saturday, April 30, 2011

Ways to be debt free: Let's talk about budget

 
I know you dread this word. Most of us don't have a liking to this word because it has that attachment to limited spending. Most people are either without budget or always spending above their budget.

But here is the truth about this word.

Budget is a tool for you to become rich. No kidding!!!!

Remember that true wealth is not in the things that you have but rather on the net worth that you represent. Let me re-iterate further. Let say you have this big bonus from your company and you decided to buy your dream car, a Lexus. So you went to the agent and you went back to the Lexus car that you kept on seeing for the past 2 years.  


Its price tag is around 3,500,000.00 pesos and your bonus is about 80,000.00. Quite too far but you love this car and you have wanted to drive one. So with a big sigh you told the agent " any discount?" And the agent gave you a 5% discount and a nice term 2.5% down payment and the balance payable in 15 years and you can't say no anymore with this deal.

So you drove that car and you think you feel so rich. Remember you have  a Lexus as your asset which has value of 3,500,000.00 but how much are you really worth after buying the Lexus? 


They key to financial freedom is accumulation. "You are what you keep" to say it in another word. And here is where BUDGETING take its place.

Budgeting shouldn't be seen as the old miser looking  man gazing at you sternly to remind you that you shouldn't be spending this and that. The goal of a budget is to spend your money and resources wisely. Budgeting is not limited to money, you can apply it to all facets of your life.
Budgeting lies on your choices. Budgeting forces us to chose wisely and differently. Why eat at a fancy restaurant when you can cook your meals better and at a cheaper cost? Or let say why dine in a fancy restaurant every other day when you could just go there for special occasion thus adding the importance of that occasion.  

You can chose to spend lots of money or to save it up in order for you to put money in a small investment that returns you earnings in the long run. I guess this is a wiser way to use your money now and enjoy the benefits later.


Look at budget as your friend and not as the old miser looking man, budget to your financial freedom. 

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