Friday Financial Tidbit-Reverse Budgeting

Credit: Lifehacker

If you have been a reader of this blog or a listener to the podcast for very long you know that I am really big on doing a monthly budget. With that being said, doing a monthly budget can become quite tedious after a while. To those people I ask, have you ever tried reverse budgeting? Reverse budgeting is inspired by my friend Josh Gordon of the Nonconformistfamily.com. To help you with reverse budgeting I have created a worksheet to get you started.

Reverse budgeting is simply figuring out what you want to do with money during the month first. Then figure out how much money you will need to earn to accomplish those goals, instead of taking what you make each month and determining what you will do with it.

I have found reverse budgeting to be helpful in getting me motivated to earn extra income. By listing all of my financial goals for the month, I think in terms of how much I need to earn instead of what I can afford. By reverse budgeting you are challenging yourself to make unlimited income as long as you do the work, whereas with traditional money you are keeping your income static and fitting your wants and needs into that number. It also makes you think outside the box and gets you into thinking about creative ways to create extra income.

So if you are tired of doing the same old budget each month and need a new take on it, try reverse budgeting. It will definitely get you to think more creatively and who knows it might help you make some more income in the process.

What’s your experience been with reverse budgeting?

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