Most people do not stick to a budget. But they should.
That is the reality for many American households, according to the Certified Financial Planner Board of Standards (CFP Board).
A survey done last fall by the CFP Board shows:
- 77 percent find it easy to spend money
- 64 percent find it easy to overspend when using a credit card or mobile payment
- 59 percent do not track their spending
- Two in five have never had a budget
- More than one in three say they spend more than they save
A barrier to creating a household budget might be what budgeting truly is. While 43 percent of people polled by Heart+Mind Strategies believe they have a budget, most say they use receipts and bank and credit card statements to track their spending.
Real budgeting is having a something in writing that outlines spending needs over a period of time or which creates plans for expenses and savings.
When doing that, 68 percent say that helps reach personal and family goals; and 67 percent believe that impacts their confidence in their financial security.
Having a household budget positively affects people’s emotional state because it reduces stress, anxiety, and frustration.
People with a budget feel more in control (62 percent with versus 19 percent without), more confident (55 percent vs. 18 percent), and more secure (52 percent vs. 17 percent).
