Do You Still Need to Worry About a Budget if Your Are Financially Secure?

It was the beginning of 1985 when I started as a financial advisor right out of college. One of the classes I had to take to learn this business was on budgeting. And I remember going through the class and they talk about going through line by line by line and looking at all the things people spend money. I was 21 years old at the time was right out of college and I had my bachelor’s degree in finance and I was in fact studying for the CFP exam back then. And I remember thinking to myself back in those years that the one group of people that we really see no utility of this are people that are making a lot of money. The very wealthy probably see no benefit to this. And of course, as a young Financial Planner just starting out, I was thinking, well that’s ultimately who I’m going to serve and so therefore this probably isn’t going to help the people that have a lot of money.

And yet, I can tell you, those are exactly the people that see most benefit of having a spending plan because oftentimes the money’s coming in and they just don’t know where it’s going.

So, you could take a person with six figures or even a seven figure annual income and it just becomes a blur to them because they’re paying so much in taxes, they’re paying so much in other expenses just maintaining their houses or the toys that have or the various things that they’ve bought over the years and it’s just really was shocking to me as to how people that have a lot of wealth and a lot of income really see the benefit of having that going through the exercise of looking at where their money is going and and having a handle on it. Because, do they need a plan? I mean, probably not. I mean, yeah, the bills get paid the income comes in. And yeah, it’s probably works.

But being present to it and being able to see where the money’s going oftentimes leads to a much greater sense of comfort. Knowing that they have a handle on where the money’s going

Let’s face it, we’ve all been through this at the end of the year. Right? How many of us have been at the end of the year where we get our tax forms. We get our W2’s and our 1099’s and look at those things and we say, wow, we made that much, where did all go? You look at your tax information. Where did that money go? And that’s the feeling that I think a lot of people have and it’s like, what do you have to show for it. Right? So you pay all your bills you got through the year. But what’s leftover and where did the money go?

I can’t think of a situation where having gone through the exercise where the person didn’t walk away with a greater sense of control just simply knowing where the money’s going.

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