The Motley Fool Money Guide
by Selena Maranjian

Sample Pages

Chapter 1: Saving and Budgeting

At The Motley Fool, one of our main goals is to get everyone on Earth investing and building a financially secure future. It’s a tall order, we know. Lots of people are not even close to the point where they are ready to begin investing, though. Instead, they need to focus on generating more money to invest. Enter the world of saving and budgeting.

1 Why should I bother with budgeting?

Most of us would rather poke ourselves in the eye than sit down and plan a budget. Many would rather slam a door on their hand than actually live according to a budget. That’s just wrong thinking, though. We should budget with delight. We should even have trouble getting to sleep at night, as we eagerly anticipate tending to our budget in the morning.

Budgeting can be very valuable because it permits you to optimize your spending. You might think that all is fine with your spending habits, but a little time spent on budgeting might reveal that you’re spending a surprising amount on something that you don’t care that much about. If so, you could tweak your habits a little and end up with more to spend on things you care about more, such as entertainment or investing.

Budgeting is even more vital if you’re having trouble making ends meet. A little analysis of your spending patterns should show you where your money is going and might help you see where you could cut back. Knowledge is power, and going through the budgeting process gives you a lot of self-knowledge.

2 I know that budgeting is important, but for the cut back. Knowledge is power, and going through the budgeting process gives you a lot of self-knowledge. I know that budgeting is important, but for the life of me I just can’t muster up the energy to tackle it. Is there any way you can inspire me to just do it?

Instead of thinking of it as an enormous lifestyle change that will have you miserably pinching pennies for the rest of your life, focus on the positives. Try thinking of it as a game — or something close to that. Or, think of it as one of those self-quizzes you take in a magazine or online, to learn more about yourself. People who budget know a lot about themselves. In many cases, figuring out where your money comes from and where it goes may even liberate you to some degree. You may learn that you have more than you think!

Note: The rest of the chapter is omitted.