Why You Need More Margin in Your Budget

Good budgeting goes a lot further than simply measuring out how much money you expect to send. You need to make sure you have the flexibility you need to adjust when circumstances change. Here are some reasons you need a more significant margin in your budget.

Leave Room to Save

Savings are important. They should be a primary motivation and goal for you regarding finances. Always try to save a consistent portion of whatever you make. Even if it’s small, the consistency will mean that gradual drops in the bucket will accumulate to something significant. 

This is how you can eventually achieve retirement. It’s also how you can afford to survive when expensive emergencies happen in life. Having a little bit of wiggle room in your budget means that you can start to save meaningfully. Ideally, you would incorporate savings into your budget when you start to calculate it.

Make it Easy to Pay Your Bills

Creating a budget that has you down to the wire can be risky. If an unexpected expense comes up, even something minor, that means that you will be struggling to pay your bills. That can have far-reaching consequences you may not expect. Having proper heating, cooling, water, electricity, and air filtration is necessary for living with dignity. 

But there are financial consequences too. Foreclosures can negatively impact your credit score for years. Even if you can manage to pay your bills, you don’t want to be living with constant anxiety about it. Having a wider budget margin will provide peace of mind.

Unexpected Expenses

No matter who you are, these things are going to happen. Things always come up you weren’t expecting and most of the time they cost money. Unexpected necessities should take first priority–e.g., medical emergencies, repairs, maintenance, replacing necessary commodities, and more. You also might find yourself in situations where you are spending money that you don’t necessarily have to spend but end up spending for convenience’s sake. This can include eating out when you don’t have to and the like. It’s always better to have a little bit of a financial safety net to keep yourself from worrying. 

Budgets are essential for individuals, families, companies, and organizations. Nobody can get along without a well-made budget. If you want to be sure that you can go about your life without suffering from constant financial anxiety, a wider budget margin is what you need. 

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