Personal budgeting for future sanity;
Did you know that your sanity in the future could depend on the way you budget your money today? It does. So, get into the habit of including tomorrow into today. I know this sounds like you are only living for tomorrow and not for today. But, believe me, you can live for tomorrow and for today. And you will be richly rewarded with a wonderful life now and in the future. Much of our worry comes from unplanned financial problems that are compounded by empty savings accounts of all types.
We hear this all the time, get emergency savings. So, what do you do, you start, you stop, you delay it, and then you have an emergency. It is inevitable, based on past experiences that most of us have had an emergency at some time during the year, sometimes two or three.
That is not the issue, the issue is that we can lessen the blow of each emergency. If we swallow a large dose of reality and accept the fact that we will have emergencies, and they must be covered by cash, (otherwise our credit will balloon out of control), with cash we will all be fine. Personal budgeting for future sanity first covers emergencies.
If you are very low income, like in the area below $15,000 income per year, you qualify for Medicaid, under the affordable care act. If not, you must pay a copayment and deductible with your insurance, and sometimes a percentage of major treatment. This has always been the case with major health insurance, and will always be. The issue is coming up with the money that will cover your, “out of pocket cost”. Create a budget for your out of pocket health care costs to avoid large financial bills if you get sick. Budgeting for future sanity includes healthcare of today since we never know what the future holds when it comes to our health.
You have two choices, 1. put your vacation on a credit card and risk having a bill to pay indefinitely or, 2. pay for it in cash, unless you want rewards points from credit cards, put it on a card and pay it off when the bill comes in.
Either way, you need money to cover your vacation, so it should be a part of your yearly budget, spread out over a twelve-month period. Budgeting for future sanity with your immediate vacations will save you large credit card bills in the long run.
When you are young you usually don’t think of retirement dates or retirement plans, but some do, and they retire early, because of it. For myself, this was a goal for me when I was very young and others I know. We all accomplished that goal. I have also read stories about those who wanted to retire at 40 and did, then they started a lucrative business without the worry of running out of money since their retirement was fully funded.
It takes a very conscious and forward-thinking 20 – something-year-old to think retirement and give themselves the option to retire early and switch careers, but it can be done.
When you are older, you could end up working into your 80’s or 90’s, that is because you did not think you would ever reach retirement age, and need retirement money. It always seemed like a distant, far-away, never-reaching date. Then, the years turned to decades, the decades turned to old age and now you are stuck. You can’t do much to change your situation, except work as a greeter with painful knees and all other health problems.
I just demonstrated how quickly time passes, if you take time seriously, you can have a great retirement, but only if you budget it into your current budget now. Some employees have a pension plus a supplemental plan, and some have social security and a 401k. The problems come when you only rely on one source. Like the pension only or the social security only. Make sure you fund all available sources and only use them at retirement, not for emergencies, not for college and not for vacation. Personal budgeting for future sanity applies to retirement savings more than any of the other
When you go to college today, it can devastate you financially for the rest of your life, and you can die with that devastation. Too many Americans go to college blindly, and they get predatory student loans because of it. Those are loans that have monthly payments that fall far more than your monthly income after you graduate because you assumed that no institution would treat you so badly. But, they do, they are in it for the money, especially the TV advertising for-profit schools, vocational schools, and private schools. You must understand the way vocational or for-profit schools charge and the fact that many employers don’t recognize the school for employment. This issue alone can devastate a personal budget.
Then there are the unsubsidized loans that students don’t understand. The balance on these loans will double when you finish school because interest is charged while you are in school. If you don’t pay the interest as you go, and most don’t because they don’t have the money, you will get a bill that reflects a balance of more than double what you borrowed after you finish your program.
There are many more nightmare scenarios, like the fact that some students max out of financial aid qualifications before they finish school and can’t graduate, this is a result of a huge personal budgeting mistake.
The issues here in the student budgets are 1. Firs,t research all the cost of your school and find out if it is in affordable limits — you should not borrow more money than you could make in your first year — set that limit to $25,000 to stay safe. 2. You should research if your school is an accredited school and recognized by local employers as a quality school 3. Research if the field you are going into is needed — many of the fields that are offered are obsolete.
Then, try to stick with quality, affordable, public schools. Keep your student loans low, otherwise, you could be paying outrageous student loan cost for the rest of your life. Many of the students who have massive student loans would be better off without any degree, and instead of working their way up on a job, some jobs even pay for education. Use my personal budgeting for future sanity techniques before you consider any school.
What is the immediate solution? Funding. Start funding several accounts on autopilot, make them a part of your budget. It is that simple. I did it for years, and it works. When I need money, I take it from one of my accounts I created a long time ago. But, if you didn’t do it before, you can start now. You can auto deduct into all the saving accounts you need. The problem with those who have budgets are that they mainly include essential items, but omit quarterly, semi-yearly, or yearly bills and emergencies, vacations, health care and retirement. This is the reason you need to apply my personal budgeting for future sanity techniques.
Lois Center-Shabazz | Course Delta Agency
Personal Finance: Author | Blogger | Course Creator
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