When it comes to budgeting, one could typically argue that a person falls into either of two groups: those who actively use budgets and those who do not. The latter can be further broken down into two other groups, those who do not know about budgeting or do not care, and those that mentally plan their budgets. Many of us fall into this very last group - those that know about budgeting, have been meaning to do it for a while, but never actually make the time to sit down and plan one. We are the people that begin to mentally do our budgets as we walk into Spar and pat ourselves on the back for being ‘so organised’ for doing it then; for being on top of our budgeting game and never letting the ball drop. The challenge, though, is that it never turns out as we imagined it would when we first walked into the shop, does it? Mentally preparing a budget may be, in fact, nearly as bad as not preparing one at all.
It is important to sit down, and properly plan how you are going to spend your money. “Most people tend to have a ‘rough idea’ of what their finances look like. They underestimate the importance of sitting down and writing out your budget. Firstly, it gives you an objective view of your finances. Secondly, it allows you to track your spending. If done diligently, it allows you to see your spending habits and nip out your spending problems,” said Wabo Moswate, Stanbic Bank Botswana Head of Products.
