One of the first questions I always ask potential clients looking for financial planning advice is, “Do you keep a budget?” The reason being that your budget is a big part of the foundation of your financial plan, whether you are just starting out or in retirement.
For retirees, the budget plays a key role in analyzing how to make your money last throughout your lifetime. Without a good handle on expenses (along with a retirement plan that includes an investment strategy tailored to helping them meet their monthly needs), retirees could be in for a shock down the road.
For those still working and accumulating assets, just knowing whether you are living within your means or not is powerful information; this allows you to make changes to put yourself in a stronger financial position. Furthermore, having a budget is crucial to making smarter decisions about future expenses and savings goals.
So this is why I appreciate the infographic below from HelloWallet, which makes a great case for the power of budgeting. Clearly, those with a budget are better prepared to weather monetary storms in the short- and long-term. So if you haven’t already, take the time to figure out your personal cash flow – your future self will thank you.