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  • ELIZABETH EDWARDS

Taking the Mask Off Your Money: The Evolution of Budgeting


Budgeting, in some form or another, has been around for centuries. The concept of allocating resources or funds towards specific purposes has roots in ancient civilizations. However, modern budgeting practices, as we understand them today, began to take shape in the early 20th century with the emergence of more formalized government budgeting processes and the adoption of budgeting techniques by businesses.


One significant milestone in the history of budgeting is the publication of the book "Principles of Scientific Management" by Frederick Winslow Taylor in 1911. Taylor introduced the concept of budgeting as a tool for management control and efficiency in industrial settings. His ideas laid the groundwork for what would become known as "budgetary control" within organizations.


In the governmental context, budgeting gained prominence with the rise of the modern state and the need for governments to manage their finances more systematically. The origins of modern government budgeting can be traced back to the reforms initiated by Otto von Bismarck in Prussia during the late 19th century, which aimed to centralize budgetary decision-making and increase transparency in public finances.


Since then, budgeting has evolved significantly, with the development of various techniques such as incremental budgeting, zero-based budgeting, and activity-based budgeting, among others. Today, budgeting is a fundamental aspect of financial management for both public and private sector organizations, playing a crucial role in planning, resource allocation, and performance evaluation.


Women, Finances & Budgeting


Fear or apprehension around managing finances can be experienced by people of any gender, but there are several societal and historical factors that have contributed to women feeling particularly insecure or hesitant about financial matters. Some reasons why women may experience fear or reluctance in managing their own finances include:


  1. Gender norms and expectations: Traditional gender roles have often assigned financial management responsibilities to men, while women were expected to focus on domestic tasks. As a result, women were not have been encouraged or taught to take an active role in managing finances, leading to feelings of insecurity or inadequacy when faced with financial decisions.

  2. Income disparity: Women have historically earned less than men and have been more likely to work part-time or take breaks from the workforce for caregiving responsibilities. This income disparity can contribute to feelings of financial insecurity and make it more challenging for women to build savings or investments.


3. Lack of financial education: Research has shown that women often receive less financial education than men, both in formal education settings and at home. Without a strong foundation in financial literacy, women may feel less confident in managing their own finances and making informed decisions.


4. Fear of making mistakes: Women may fear making mistakes or facing financial consequences, particularly if they are managing finances independently for the first time. This fear of failure can be a barrier to taking proactive steps to improve financial literacy and confidence.


5. Social and cultural factors: Societal messages and cultural norms can influence women's perceptions of their financial capabilities. Negative stereotypes or beliefs about women and money may contribute to feelings of fear or inadequacy when it comes to managing finances.


Addressing these issues requires a multifaceted approach, including providing access to financial education and resources, challenging gender stereotypes, promoting financial independence, and advocating for policies that support gender equality in the workforce and beyond. Encouraging women to take an active role in managing their finances and providing support and guidance can help empower them to overcome fear and build financial confidence.


Millenials, Gen-X, Gen-Z



The financial literacy levels among Millennials, Generation X (Gen-X), and Generation Z (Gen-Z) can vary based on factors such as access to education, socioeconomic background, and life experiences. Here's a brief overview of financial literacy within each generation:


  1. Millennials (born approximately between 1981 and 1996):

  • Millennials have been noted for facing financial challenges such as high student loan debt, stagnant wages, and the impact of economic downturns like the 2008 financial crisis and the 2020 COVID-19 pandemic.

  • Many Millennials have demonstrated an interest in financial education and have sought out resources to improve their financial literacy, including online courses, personal finance blogs, and podcasts.

Generation X (born approximately between 1965 and 1980):


  • Generation X is often considered to be more financially savvy than Millennials, having experienced economic booms and busts throughout their adult lives.


  • Many Gen-Xers entered the workforce during times of economic prosperity but also faced challenges such as high housing costs and job instability.


  • Gen-Xers are typically more likely to have participated in employer-sponsored retirement plans like 401(k)s and may have a greater understanding of investment concepts compared to younger generations.

3. Generation Z (born approximately between 1997 and 2012):


  • Generation Z is just beginning to enter adulthood and the workforce, so their financial literacy levels may still be developing.


  • Early research suggests that Generation Z may be more financially cautious and risk-averse compared to Millennials, possibly as a result of witnessing the financial struggles of older generations.


  • Generation Z has grown up in an era of rapid technological advancement and digital innovation, which may influence their financial habits and preferences. They are often adept at using technology for banking, budgeting, and investing.


Millennials and Gen-Xers may still struggle with basic financial concepts such as budgeting, saving, and investing. Some factors contributing to this include a lack of formal financial education in schools and a reliance on credit cards and debt to cover expenses. Debt management and retirement planning as they balance financial responsibilities such as saving for college for their children while also planning for their own retirement can also be a challenge.


Generation Z may still face challenges related to student loan debt, housing affordability, and job market uncertainty as they navigate their financial futures.


Within the past month, a new budgeting term has been coined (no pun intended): 'LOUD' budgeting. This new budgeting technique created by Gen-Z comedian Lucas Battle as a joke has seemed to hit a nerve for young adults. LOUD budgeting is taking responsibility for living on a budget and being vocal about it. Millenials, Gen-X and Gen-Z co-horts are said to have the lowest financial literacy of any generation, according to this CNN video.


Overall, improving financial literacy across all generations, male or female, is crucial for promoting financial stability and well-being. Initiatives such as financial education programs in schools, workplace financial wellness programs, and accessible resources for self-directed learning can help all individuals improve their financial literacy skills and make more informed financial decisions.


Do you need help creating a sustainable budget and livable spending plan?








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