So, what’s the good news you have for us? You’re debt free? Great! And you have a fully-loaded emergency fund? Fantastic! Your finances are in a terrific state, and you feel economically stable for the first time in your life? That’s just wonderful. What else? Oh, you want to stop budgeting?
Well, let’s take a step back for a moment. Budgeting is now part of your life just like brushing your teeth or making sure you shower at least a few times a week. It’s not something you can give up cold turkey, especially so soon. Yes, you feel your finances are secure right now; however, there are so many more monetary decisions coming up in your life that are going to require you to plan ahead. You can’t just throw your money around, even though you feel like you could right now. Here are a few of the other items that require the continuation of a budget for your finances.
Finances and your retirement
You may feel stable now but what about in the future when you are not working? A debt-free life with a funded emergency account means it’s now a perfect time to maximize the amount of money you contribute to your retirement, and that means you need a budget to determine how much is going to be taken out. This is particularly true if you are a freelancer or business owner without a corporate-based 401(k) or other related account.
Paying off your home
There’s still one large burden with your finances hanging over your head even when you’re debt free — your home. And this isn’t your mortgage alone. It may also be mortgage insurance or a home equity line of credit. There’s a definite feeling of true independence with your finances when you no longer have a mortgage and own the home outright. A budget comes in handy at this point to determine the maximum amount of funds you can put toward paying off the mortgage each month.
Yes, you still have some responsibilities with your finances left over once you’re debt free, but it doesn’t mean you can’t enjoy your new found wealth. You may want to travel or start a business that’s your passion. All of these are going to require budgeting your finances to pay for them over time. Without one you could overspend and up back in the same place you were when debt overloaded you and the emergency fund wasn’t populated.
Donating to causes
The best thing about being deft free is not the ability to jump into piles of money in your vault. In the end, it’s about giving to organizations that assist people not as fortunate as you. We’re sure there are a number of non-profit organizations you’ve always considered making significant monetary donations to, so a budget helps you organize those donations into a simple plan.