by Scott L Nelson Stake Finance Specialist

Do you ever feel like your money has just evaporated? Of course, money does not really evaporate but it can seem like it does if you are not actively keeping track of it. If you are like most people, you probably aren’t actively using a budget. A budget is simply a spending plan that considers both current and future income and expenses. The importance of making and following a budget is a financial practice that cannot be overemphasized. If you and your family want financial security, following a budget is the only way to do it.

This is the main activity of the Church’s Self-Reliance Personal Finance workshop. Approximately 6 weeks are devoted to keeping receipts, building a budget that works for you and then learning to follow it. Following a budget provides many blessings, here a 6 to consider:

1. It Helps You Achieve Your Financial Goals

Saving money is just choosing to spend the money later for something you want more. the budgeting process helps you figure out your long-term goals and work toward them. If you just drift aimlessly through life, spending your money on anything that catches your attention, how will you ever have enough money to get your next car, buy a house or retire?

A budget helps you to map out your goals, save your money, keep track of your progress, and make your goals become a reality. It helps you to follow President Oaks advice to choose the “Best” over the other “Good” things you could spend your limited resources on.

2. It Helps Ensure You Don’t Spend Money You Don’t Have

Far too many people spend money they don’t have, largely because of credit cards and overdraft lines of credit. In fact, the average credit card debt per household reached $5,525 in 2021. When people

overuse and abuse credit cards, they don’t always realize that they are overspending until it is too late. Consider Elder Holland’s recommendation for “plastic surgery” if this is problem for you.

However, if you create and follow a budget, you’ll never find yourself in this situation. You will know exactly how much you earn, how much you can spend and how much you need to save each month in order to achieve your goals.

3. It Helps You Recognize Bad Spending Habits

One of the most common bad spending habits reported by participants in the Self-Reliance Personal Finance workshops are impulse buys, usually at convenience stores on the way to work each day. The first step in building a good budget is to look closely at our spending habits. A good way to do this is to keep the receipts for all purchases and review them together. As we look at these purchases over a month and compare them to our long-term goals it makes it easier to change our bad spending habits.

4. It Helps You Prepare for Emergencies

Life is filled with unexpected surprises, some better than others. When you get laid off, become sick or

injured, the car breaks down or there’s a death in the family, it can lead to some serious financial

turmoil. If money is tight enough, a broken shoelace can seem like an emergency if you don’t have enough money for a new one. It seems to me that these things always happen at the worst possible time. This is exactly why everyone needs to have an Emergency Fund.

We have been counseled to have 3 to 6 months’ worth of living expenses. Having an emergency fund of this size will take some time to build up. But having a reserve fund of that size will make what seem like impossibly high financial mountains to seem more like speed bumps because you’ll be better prepared to deal with them.

5. It Helps You Prepare for Retirement

Let’s say you spend your money responsibly, follow your budget and never carry credit card debt. Good for you! But aren’t you forgetting something? In the manual for Self-Reliance Personal Finance, we are given a Road Map. It shows Faith in Christ as a Foundation followed by Protecting Our Family from Hardship, Eliminating Debt and then Save and Invest for the Future. Are you contributing to your employer sponsored retirement plan? Why not? Many will match your contributions. That’s FREE money! If you don’t prepare for your retirement, who will? Retirement Savings should be a budget category.

6. It’s Better Than Counting Sheep

How many nights have you tossed and turned worrying about money related issues? Keeping and following a budget can give you financial peace of mind and allow you to get more sleep.

May the Lord bless you as you strive to be good stewards of the resources, He has blessed you with. Sincerely,

Scott L Nelson Stake Finance Specialist