The title attracts you, right? Everybody wants to be financially self-sufficient. However, very few really are.
Why? Look at yourself while asking this question. In most cases, your needs will seem to expand commensurate with your income. Somehow, the needs seem to always be just a little more (and in some cases, much more) than what you can afford. If you have found yourself in this situation much too often, it's time you learn the one vital secret that will set you free.
This secret is called "Budget."
Budget Your Income
Many people think of budgeting as "something I know I should do, but never can" and leave it at that. Do you really want to be free of debt? If your answer is "yes", sit down now, take a pencil and paper and write down your budget - Today - Now!
Budgeting is an art that needs to be mastered – though it's not difficult to do so. Start with your savings. You must keep aside 1% - 25% of your income as saving. This is non-negotiable.
Then you list the "must-haves" or essentials. These are groceries, utility bills, medical insurance and all such things that you cannot do without. Once this is complete, go to the fun items that give you pleasure such as dining out, occasional shopping for a gift and the like. Add 1% - 10% for charity and here you are – you have a budget!
When you are down with more bills to pay than you have income, run the "emergency" budget. This is a budget that consists of only the essentials. At such times, you need to subtract all expenses that exclude the must-haves (and savings) and continue to adhere to this budget until you have completed repaying all your outstanding bills.
Why Budgeting Is Vital
It's important to "plan your money." But you will never be able to do so, until you know exactly where your money goes.
Very often there is an acute drainage of resources on seemingly innocuous expenses such as daily doughnut and cappuccino, or having chips or coke. Your cigarettes, party expenses, sudden impulsive shopping sprees, beer runs, etc. can work out to huge amounts unless you have them calculated on a monthly basis and checked.
When you budget, you will be able not only to keep superfluous expenses in check, but also put your money to best use. This does not mean you can't have any fun. Have an amount allocated to "fun" as well, and ensure that you stay within that budget.
The beauty of the budget is that you will be able to have everything you want the way you want it – because once you plan it all out, you'll be able to do much more with your money. This is why budgeting is known as the most vital secret of financial self-sufficiency; or the key to optimal financial management.