There’s a reason it’s called your cash “flow” or your income “stream.” Money is like water and your income is like a river. They both flow. Some rivers are bigger than others. Some are little streams, while some are huge, with millions of gallons flowing daily. Rivers generally follow the path of least resistance and this reflects most people’s financial lives. They wander around with no particular place to go but to the shallow sea of disappointment.A budget re-directs your water currency so that irrigation canals can water crops. Your “crops” might be paying down debt, saving for a newer car, or contributing to a 529 plan for your children’s college education. Irrigation canals can stretch for miles and benefit far more crops than just those nearby. If you properly re-direct your water currency, you can be in a position to bless the lives of countless other farms. Imagine being in the position to sponsor a missionary, give to a charity hospital, fund the children’s wing of the library, or personally buy a car to give to a disabled Iraq war veteran. The “crops” you grow can be harvested and shipped around the world.
A budget can dam up huge amounts of your water currency, releasing it in a controlled way so that millions of kilowatts can power homes and businesses. When you can control the downstream flow of your water currency by proper budgeting, you’re able to use that energy to change your life. Municipalities dam rivers and streams so their cities can have drinking water. When you dam your river, you have reserves for emergencies. You have reserves to put out fires. You have reserves for the possibility of becoming disabled. You have reserves for blessing your family with financial peace rather than the raging rapids and turmoil of financial frustration.A budget can direct your water currency to turn a water wheel to grind grain into flour. When it does, the water is working foryou. You are making it behave and perform the tasks you want performed. It no longer wanders around just getting absorbed by the earth but it changes something that is almost inedible into a product that can make everything from warm cinnamon rolls to chocolate birthday cakes to a hearty piece of crusty bread to eat with a bowl of hot soup.Sometimes streams will disappear, plunging deep underground into limestone caves and caverns. Geologists then have to dye the water to figure out where it’s coming out again. Most times they’re able to locate where it reappears, but sometimes they don’t. Debt has the same effect on your water currency. If you don’t take care to re-direct your income stream, you run the risk of having it disappear and you may or may not be able to find it again as your pour thousands of dollars down the cave of debt. It may take years to recover and then you will always wonder what could have been. What if I had listened? What if I had taken that advice?
Rivers can also be highly dangerous. A powerful river can pull you down into a funnel, plunging you headfirst into a whirlpool and just keep you there. Other times it can toss you around like a rag doll. Money, your water currency, can do the same things to you. If you are or have been deep in debt, have you not felt at times like you were in the death spiral of a whirlpool?
Rivers can also be great sources of fun. I spent a day trip with family and friends, whitewater rafting down the Ocoee River just east of Chattanooga. The power of water, like the power of money, is incredible. It can take you down its path and at times you feel completely out of control. Nothing you do seems to turn the raft or even remotely slow it down. At other times the river can be calm, smooth, and relaxing. Then it can change in an instant and be exhilarating again.
Just remember, budgets aren’t restrictions on fun, they’re the canals and dams that channel a very powerful force. You can whitewater raft in the tail waters of a dam and have a great deal of fun. You can generate your own kind of peace and happiness by budgeting a category for blessing the lives of others. You can have a great deal of fun living life in the knowledge that one day you will be able to retire quite nicely, and possibly help fund your grand children’s dreams because you put your money to work for you.
Use your budget to channel irrigation, to dam up a reserve, to work for you, and to have fun. Always budget for fun. It keeps you on course and avoids making your budget a stagnant pond. No one likes a stagnant pond.