Business Tip: Budgeting helps build savings

By Brian Cunningham
May 27, 2014 at 12:27 a.m.

Have you ever tried saving money each month or throughout the year and seem to never be able to make any ground? Whether for your business or personal financial gain, saving money is one of the best things you can do to safeguard your future.

However, if you don't budget your finances, saving money becomes almost impossible, and getting ahead can feel like a daunting task.

Saving money really is a lot easier than most make it out to be. If you can pay your other bills each month such as your car note, electric bill or gas bill, why are you not saving money? In other words, you have to pay yourself, too. By making a repetitive entry to a savings account of some kind each month, you will quickly get in the habit of saving money no matter what the amount is.

If you are only able to contribute a small amount each month, that's better than not contributing to your savings at all. The key to making your savings account grow is having the discipline to make the contributions to your savings account.

To prepare a budget, add all of your expenses that you would normally pay out each month as well as all of the deposits you would accept in a month.

It's easiest to separate these categories into two columns and simply subtract your monthly expenses from your income. Whatever you have left is the amount you can allocate toward your savings account.

Keep in mind that entertainment expenses are the easiest to overlook or understate and will quickly disrupt the budget you are attempting to create. A rule of thumb that I find makes this process a little less rigid is to overestimate on your expenses and underestimate your deposits. That way you get a "worst case scenario" and budgeting should be easier for you.

Another rule of thumb is to only use the money you set aside in this savings account for emergency purposes; after all, that's what it is there for. If you find yourself wanting to use this money for other things such as taking a vacation, then you should have two different savings accounts, and one should be used for vacations and such and the other for your emergency fund.

Setting aside money will make your financial position stronger and should give you a sense of having control over your own money. Dave Ramsey said it best when he said, "A budget is telling your money where to go instead of wondering where it went."

Brian Cunningham is a Certified Business Advisor II with the UHV Small Business Development Center. To make an appointment for business services or register for a UHV SBDC workshop, call the center at 361-485-4485 or email at



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