“Budgets are shock absorbers for money stress”
I have and will in the future continue to extoll the benefits of YNAB and managing a budget in general. While people often view budgets as this constraining thing preventing them from using their money for what they want, the entire opposite is true. Budgets are just shock absorbers for money stress.
If you handle your budget correctly, you should assign the money you have into the categories you want to use it for. You plan ahead for things you know you’ll have to pay for. But you also prepare for the known unknowns. Meaning, you don’t know when your car will break, what it will be, or how bad it’s going to be. But you can be sure it’ll happen in some point in the future, and you can estimate, roughly, how much it’s going to cost.
So let’s say you even did that but your car broke and it costs more than you thought. Well, because you assigned your money to categories according to how you want to spend it, you have money assigned to less important, more quality of life categories, or you have a lot of money in important categories that you can be fairly sure you won’t need in the immediate future. You can take that to cover the extra cost of that car repair.
The result is: you suffered a setback but you properly prepared for it and you know exactly where it hit, how much, and how it will affect the rest of your life. It’s not great, but because you have a proper budget, it’s not as stressful as it would have been without it.
That’s why You Need a Budget.
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