Have you ever wondered why budgeting is suggested as the cure to almost every financial problem or goal? It’s because budgets are an essential part of financial planning. They serve as the blueprint and roadmap for your finances. An adequate budget enables you to see where your money is going. It helps you cover expenses, evaluate spending, manage debt, build savings, and make informed decisions that ultimately help you achieve financial wellness.
Though budgeting is essential, applying it to your finances is another story. You can create a budget every month, but you’ll never see financial progression if you don’t use it. Organizing, tracking, and applying a budget is time-consuming and challenging; ONE offers a simplified solution.
What Is ONE?
ONE is an online bank offering comprehensive products and services to everyday consumers whose main objective is to achieve financial wellness. ONE’s mission is to provide customers with the essential tools to conquer the most challenging financial principles, including banking, saving, and budgeting. Along with secure, free, and easy-to-use checking accounts, ONE customers also have access to resources like Pockets to help master budgeting.
What Are Pockets?
Pockets are sub-accounts tied to your ONE checking account. Customers can separate their income into customized Pockets that align with their budgets. They can draw from the appropriate Pocket to cover the expense as they complete transactions.
Pockets Keep You Organized
When you have multiple transactions coming out of one account, it can be challenging to track where your money is going. Pockets enable you to create categories for better management. You can create a Pocket for utilities, gas, lunch money, entertainment, healthcare, pet needs, groceries, education, etc. Ultimately, you’ll get a better picture of how you’re spending to make better budgeting decisions to improve your finances.
Identify Financial Needs
One of the most efficient ways to avoid debt, prepare for emergencies, break the paycheck-to-paycheck cycle, and reach financial wellness is to be aware of your financial status. You may know how much you make each pay period, but is it enough to cover your expenses or accomplish your goals? Budgets provide the answers to these questions.
Since Pockets show you where your money is going, you’re better positioned to determine when you have a financial need. For example, let’s say you distributed your income into designated Pockets then learn that you’re barely scraping by. Based on your discoveries, you know whether you need to adjust your spending habits or increase your income to sustain your budget.
Develop Healthy Spending Habits
People often believe they’re financially strapped because they have poor spending habits. They usually don’t use a budget and can haphazardly make purchases on things they don’t need. Eventually, these poor decisions lead to financial strain and high debt.
Using resources like ONE’s Pockets makes it easier to identify poor spending habits and nip them in the bud. As you review transactions made from your Pockets, you can track areas of concern. For instance, you may learn that you’re dedicating a lot of money to streaming services, coffee, late fees, utilities, or entertainment.
Once you know your weaknesses, you can create a plan to overcome them. Whether that means cutting subscriptions, making coffee at home, paying your bills on time, or finding affordable entertainment, it helps you develop healthier habits. It won’t be long before you start to see the fruits of your labor as your cash flow improves. Then you can apply the funds to more beneficial areas of your life.
Budgeting is one of those financial planning practices that is essential but also challenging. Rather than avoid budgets altogether, consumers can utilize tools like ONE’s Pockets to get their finances on track. Pockets work hand in hand with your budget for better organization and tracking, ultimately leading to better spending and improved finances.
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