It all begins with drawing up a budget …

A budget is the cornerstone of your financial plan, and the decisions you make daily determine your financial destiny, says Natasja Hart, an awardwinning financial planner and the wealth manager at GCI Wealth.

You need to budget to save and invest, Hart says. “Saving and investing amount to paying yourself first, but people don’t think of it that way. When I ask clients what the first line item on their budget is, most people say ‘bond repayments’.”

Although a home is an investment, she suggests to her clients that they put saving for a short-term goal, or a small saving as a reward for budgeting, as the first expense on their budget. “It’s psychological: if you don’t pay yourself first, you can feel negative about your budget,” she says.

Hart tells of how she helped a client overcome her negativity about budgeting. “My client felt very overwhelmed by her financial situation when she came to see me for the first time. She felt particularly guilty about what she spends on coffee every day. She didn’t want to give up her daily coffee, so we made it the number one item on her budget and made it her reward to herself for sticking to the budget. I knew she was going to spend that money anyway, and there was no point in her feeling guilty about it,” Hart says. What was more important was that she had a budget and stuck to it.