Adapt
Rule 3:
Roll With the Punches
Secure
Rule 4:
Live on Last's Month Income
Four Rules to Rule Them All
The Four Rules to Rule Them All
We want you to be in a place where what you are spending this month is money you earned last month. Rule Four is your goal and by doing the first three, you'll be there sooner than you think.
Picture this, a bill arrives and you pay it. That's it. No need to wonder if there's money in the bank or maxing out a credit card. Just pay it and move on.
All the money you need for next month is already sitting in the bank for a rainy day. The only thing you need to worry about is to resist the urge to splurge.
A boxer moves his body in the same direction as his opponent's punch, lessening the blow. Budgeting is no different. By being flexible and addressing overspending as it happens, you keep on scrapping!
Overspending happens for a lot of reasons, and you shouldn't feel ashamed. Sometimes it's a mistake, sometimes it's unavoidable, and sometimes, it's a conscious decision. When this happens, it's important to manage your budget in a way that keeps you on track toward your financial goals while adjusting what's occurring now.
Let's say it's Thanksgiving and you need to spend $20.20 over your budget because the whole family is coming over and they eat seconds.
You remember there are great holiday movies on TV that you'd want to watch after dinner. Well hey, stay in! You decided to lower the amount of money you've budgeted for entertainment and move it over to groceries. Mission accomplished.
Continue to use Rule One throughout the month, while Rule Three keeps you in the fight.