Sam and I are pretty big on our personal budget. We usually follow a personal budget and allocate funds to certain areas of our life. Currently, we are renovating a house to move into, while finishing up the one we are in, to put it on the market. This has destroyed our budget, since we are paying for 2 mortgages and the rehab costs associated with both properties. However, when this is done, we will get back on track and follow our personal budget.
This does make me think about following a budget for work. Kyle and I renovate houses, sell them or rent them for our day job. We set target budgets for the whole job, but then we do not track the budget based on categories. I never thought of this until I realized, Sam and I, are not following a budget on our current house we are renovating to move into. We do not track our budget and break it down into categories. We just put an end amount of money and hope we hit it. So, by tracking a budget, both for our personal home and for our business, we would see where we over spend or under spend on our budgets. Allowing us to get a more accurate picture on the next property we renovate.
On the last property we did, we had a $40k budget. After reviewing the overall budget today, since the property sold this week, we realized we went over by quite a bit. Now, I have to go breakdown the budget, to see where we went over and why. This could help to see if there was waste on the project, if our numbers were unrealistic, or if we ran into projects we were not expecting to do.
I remember when I was a part of Stable Living, we had projected budgets for each house. However, we never went back to check every month to see if our budgets were actually on or not. Now, with this realization, I need to start tracking things in my current business. I need to know exactly where our money is going and how much is being allocated to each category.
So… in your personal life or your business life, are you being lax on your budgets? Are you following a budget or checking up to make sure you hit your goals?
I encourage everyone to look into this to get your actual operating costs of your personal and business life. It can be quite eye opening. Kind of how, most of my fun money gets spent on fast food and energy drinks
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