Creating budget is an activity to control the finance. It is similar to a handbook that guide us to spend what we need and find money to fulfill the daily necessity.
In an office, there are two employees who have different salary. Mr. Patrick is a high paid employee in the office who cannot fulfill the daily necessity. The salary is not enough for him whereas Mr. Straw, a lower paid employee, can fulfill the daily necessity. Mr. Straw also invests the money to stock and precious metal. Both, Mr. Patrick and Mr. Straw is married with two children.
Mr. Straw also creates the budget every month. He is very disciplined man and obey the budget. He never takes the credit to fulfill the daily necessities and he has no credit card. He prefers to buy anything cash so he never receive credit card bill letter. He has plan to school the children to medical school or university.
However, the budget also has some weakness. Mr. Straw always creates the budget every month. He always evaluates the budget at the end of the month. Sometimes Mr. Straw should work until late night to make correction.
Mr. Straw's lifestyle changes as the budget has written. He decreases some spending for other spending or investment. He prefers to go to office by bus or subway. He just uses the car at the weekend so he can thrift some dollar. Sometimes he tired to office because he uses subway.
Some people dub Mr. Straw as a miser people. They think he is able to use the car but he does not use it. Mr. Straw supposedly calculates the aggregate benefit of using car or subway. Using car may be expensive but he can arrive in the office early. He does not need to stand inside the subway. Unless Mr. Straw is still young or has health body. Going to office with subway is not problem. If Mr. Straw got sick, he will pay for hospital fee that it is not cheap and he must be rest.
The Mr. Straw should delete some spending because it is not recorded on budget. The budget makes Mr. Straw become spending mindfulness. Mr. Straw supposedly manages to increase the income. He can use the asset such as car to make money. He can rent it to the rental car. When he needs the car at the weekend, he can use it.