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You Really DO Need A Budget (and TWO special offers)
Posted By Ron On January 11, 2010 @ 3:00 AM In Budgets,Personal Finance | Comments Disabled
For the past two years, I’ve promoted various company’s budgeting software but after reviewing You Need A Budget  (called YNAB ), I’m changing horses mid-stream. Before I get into why, why do you need a budget in the first place?
Creating a realistic budget—and abiding by it—is the foundation of successful personal finance. More specifically, budget planning helps you analyze your spending and avoid spending more than you earn.
Financial budgeting enables you to analyze where your money goes every month: you’ll see how much you spend on food, utilities, entertainment, healthcare, insurance, and so on. You can then use that information to adjust your budget plan if necessary, such as by cutting back entertainment expenses to increase your monthly surplus for saving or investing. YNAB’s  system, once you’re set up, does this automatically and allows you to categorize every dime you spend so you can make adjustments next go-around.
People who don’t follow a prioritized spending plan tend to spend everything they earn—and even more. In fact, in 2006 the average savings rate in the United States fell to –1%, its lowest level since 1933. Most people start by overspending and end up in debt because they fail to compare the amount of their income to the amount of their spending (the basis of a budget plan).
Sticking to a budget helps you avoid the temptation to spend beyond your means, even if you do use credit cards . Budgeting properly also leaves you with a surplus of money each month that you can use to save, invest, or cover unexpected expenses, such as medical bills.
YNAB  bills itself as different than other budget or money management programs and the reasons are many:
1. From now through January 31, 2010, readers of The Wisdom Journal  who purchase YNAB’s  winning budgeting software are eligible to receive 10 percent off their purchase when they enter the coupon code: WISDOM at checkout.
2. Check out YNAB  today and tell me what you think in the comments. One reader will receive from me – at no charge – a gift certificate to get YNAB  for themselves. All you have to do is comment by midnight January 31st (no multiple entries). Include a budget or finance related topic you’d like to see discussed on this blog in the future and you’ll receive TWO entries!
I’ll announce the winner on February 1st.
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