Financial Anxiety? How budgeting can improve your mental health
Are you familiar with that feeling of dread that creeps in as your payday approaches, even if it’s a fixed date each month? Do you often wrestle with guilt when the urge to treat yourself arises? If so, you’re not alone.
Many individuals experience this monthly ritual of financial unease, especially those with stable incomes. However, there’s excellent news: you don’t have to endure this needless suffering. You can enjoy treating yourself throughout the month without the anxiety of squandering your hard-earned money. The solution? Budgeting.
Budgeting is the practice of meticulously monitoring your expenses within your pay cycle, and it serves as a foundation for achieving financial stability. While anyone can become wealthy, maintaining that wealth requires deliberate effort, not chance. Interestingly, budgeting is a habit often forced upon Kenyans when they leave their parents’ home or somewhere familiar. In their initial months of such changes, they grapple with adjusting to this new financial discipline while dealing with the broader challenges of adapting to a new life and environment.
If you’re considering trying budgeting for the first time or giving it another shot, be aware that many before you embarked on this journey but couldn’t sustain it. The key ingredient to success in budgeting is discipline. Discipline is essential on two fronts when it comes to budgeting:
The discipline to track every expense
Tracking expenses is like caring for an infant – it doesn’t take care of itself. You must document every transaction promptly. This is where many falter; they attempt to track for a few days but lose momentum because they fail to record some expenses in real time.
The discipline to stay within your set budget for each expense
Simply documenting transactions is not enough; the real essence of budgeting lies in your commitment to stay within the predetermined budget for each expense.
While this may seem daunting, it pales in comparison to the mental stress associated with financial anxiety and the increasingly distant prospect of achieving financial stability. The beauty of budgeting lies in its adaptability; it can be tailored to fit your unique expenses and lifestyle. Without further ado, let’s delve into how budgeting works.
Getting started with budgeting
Select Your Budgeting Tool: Your choice of a budgeting tool is critical and can make or break your commitment. It’s essential to use a tool that is simple and easily accessible. While some individuals use Excel for budgeting, it may not be very mobile-friendly. Mobile apps designed for budgeting offer convenience – you can enter expenses on the go. There are numerous options available on Google Play and the App Store.
Outline your monthly income: Whether you have a single source of income or multiple streams, including occasional cash gifts, document them all. If some income arrives quarterly, bimonthly, or annually, divide it to calculate the monthly amount.
List your monthly expenses: The list of potential expenses can be extensive, but categorize them and establish a budget based on past months’ estimates, adjusting as you gain experience with budgeting.
Start tracking: This is the ongoing step in budgeting. Enter all expenses into your budgeting app under the appropriate categories. If a particular category is nearing its limit before payday, you can make adjustments by spending less or not at all in other categories. Over time, this discipline will lead to leftover funds from your monthly income that can be directed toward savings.
If you’re seeking to alleviate financial anxiety and build a more stable financial future, embrace the practice of budgeting. Remember, discipline is the key to success in budgeting, and with dedication, you can enjoy financial peace and prosperity.
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