The Most Important Question to Ask Before Budgeting (Video)
What do you think is the most important question you should ask yourself before you start to formulate your budget? “How much money do I bring home every month?” “How much am I spending?” “Do I have too much debt?”
Even before you start asking yourself these specifics, I want you to answer this question first: “If I woke up tomorrow and felt really good about my finances, what does that look like?” What would have to change for your money stress to subside?
I ask this question to every individual, couple, and business owner who comes to me for financial coaching. The answers are always slightly different. “My student loans would be paid in full.” “I’d have enough in my investments to retire in five years.” “Our credits cards would be paid off and we’d have cash for a Disney cruise.”
When I hear the answer to this question, it reveals two things: my coaching client’s pain points and their dreams for the future. Why is this important? When you’re working hard to implementing your Financial Road Map, your pain points give you direction and your dreams provide fuel for the journey.
The pain points tell me what we must focus on first. If you begin to see tangible improvement in your money situation in an area that’s been a constant thorn in your side, you’ll be encouraged and excited to keep going. There is one homework assignment that I give to all of my coaching clients: making a Financial Vision Board. Why? Sticking to a budget takes effort, so by keeping our dreams front and center, they will feed our motivation daily.