Budgeting is a 4-Letter Word
How to Build a Budget That Works on Any Income
Video Transcript
Introduction to Budgeting Series – Video Transcript
0:10
Hello, my name is Scott Hannah, the President of the Credit Counseling Society. We’re a non-profit service offering no cost confidential counseling, personal budgeting guidance, educational workshops, and low cost debt repayment programs to people throughout Western Canada and the territories. We’re an accredited member of Credit Counseling Canada, a national association of non-profit credit counseling agencies. Our accreditation confirms our commitment to our clients and the communities we serve to uphold industry best practices and standards. Our mission is to educate Canadians in personal money management, the wise use of credit, and to help individuals and families find solutions to their financial difficulties through objective counseling and debt repayment alternatives.
0:52
It may surprise you to learn that the two leading causes of financial problems today are a lack of personal budgeting skills and overuse of credit. I’m sure you’ve heard the saying, “Failing to plan is planning to fail.” Unfortunately, it’s a growing problem in Canada. Learning good money skills and planning will help you to achieve your financial goals and break the habit of living paycheck to paycheck.
1:14
Working towards a goal of buying your first home or having enough money to fund your retirement is a lot more fun than struggling year after year to make ends meet. It may also surprise you that learning how to manage your money well and developing good budgeting skills is not that difficult. It just takes a bit of time and practice. Unfortunately, most of us are reluctant to talk about our lack of money skills with our friends and family and try to learn these lessons on our own through trial and error. This can be a very expensive and frustrating way to learn and it’s not always successful.
1:48
We developed this instructional video on personal budgeting to encourage and help people to learn practical and effective ways to manage their money better. Over the next hour, Julie Jaggernath, our Director of Education, will show you how to get started on your own path of learning how to budget your money and expenses and develop plans to achieve your financial goals.
2:07
Like the saying goes, practice makes perfect, and it certainly applies to learning good money skills. Once mastered, these skills will serve you well throughout your life. On behalf of the Credit Counseling Society, I wish you success on your own journey of learning how to manage your money well and work towards achieving your financial goals.
Video Transcript
How to Make a Budget – Video Transcript
0:10
We firmly believe that it’s not how much you make, but what you do with what you’ve got. Proper money management doesn’t involve a magic formula to find more money. It simply means getting the most from the money you do have.
0:23
I’m Julie Jaggernath, the Director of Education for the Credit Counseling Society. Here, we’ll take the time to outline a straightforward method of how to get started with the budget. As you develop budgeting and money management skills, you’ll be able to adapt what you learn here and make it your own. Before we start, we need to make sure that we all know what we’re talking about.
0:58
So, very basically, what is a budget? Take a moment to jot down or share what you think of when you hear the word budget.
Video Transcript
What is a Budget – Video Transcript
0:00
The word budget means different things to different people. For some, the word budget has negative connotations. That ball and chain. Save and don’t spend a dime. If you think of a budget as deprivation and limitations, I encourage you to keep an open mind as you work through this DVD.
0:17
We work hard for the money we earn. So spending it the way we would like to and to meet our goals is much more realistic and a whole lot more fun. For other people, the word budget is much more positive: managing priorities and having a plan for their money. We make plans for all sorts of things: meeting with friends, taking a vacation, moving to a new home. The word plan is a very positive word to use if you don’t really like the word budget.
0:45
When you think about what a budget includes, most people can list their sources of income as well as name the main expenses they have each month. Quickly take a moment to list off a dozen things that you spend money on each month.
Video Transcript
The Biggest Budgeting Mistake – Video Transcript
0:00
Many of the things you mentioned are probably the typical expenses most people have each month: housing related costs, groceries, eating out, medical expenses, bills that you need to pay, and so on. Forgetting to set money aside for future needs and possibilities is a fatal flaw in so many budgets. Sometimes it’s because we forget what these expenses are or that they will come up eventually. However, more often than not, when we think of setting money aside or saving for something, we don’t typically think of doing this for normal expenses like for car repairs, clothing, gifts, and home maintenance. We typically think of savings for long-term planning like for retirement, vacations, buying a home, starting a business, or helping our children or other family members.
0:49
When we build our budget, if we don’t set money aside for the things we forget about, our plan is doomed to fail and will cause us to rely on credit to make ends meet. We’ll take some time later to identify what these forgotten expenses are and what we can do about including them in our plan.
1:07
If a budget is a plan, why bother making a plan for our money? What’s in it for us if we do? Take a moment to talk about the benefits of being good with your money.
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