Whether you are living paycheck to paycheck, trying to pay off debt, or simply wanting to be fiscally responsible, budgeting is the only way to go!
Learning to budget and manage your money is easier than you think and more manageable.
Here are a few tips and tricks that can help make sure your budget is realistic and set yourself up for success.
Make a Budget Template
There are plenty of FREE templates online that you can print. Everything from Dave Ramsey to some that bloggers have posted on their websites.
Write out Fixed Expenses
Using the budget template that you chose, then write down all the category items that you know the exact cost of.
This includes recurring bills, medicine, credit card, upcoming birthday gift, family event, etc.
Once you print out your budget, you are ready to start getting serious and writing down the numbers.
Write Out Variable Expenses
This is where you write out your budget for items such as gas for the car, groceries, dining out, entertainment, shopping, coffee shop runs, etc.
Set Realistic Numbers
If you want your budget to work, the first thing you need to do is set realistic numbers.
For example, you aren’t going to put $200 a month for groceries if you are feeding a family of 6. Write down what you spend, not what you wish you spend.
Know the difference between needs and wants
Housing (Rent or Mortgage)
Utilities (Trash, water, electricity, etc)
Food (Groceries only)
Household Items (Shampoo, toilet paper, etc)
Everything else is not a necessity and falls under the wants category.
Tackle Your Debt
Imagine the weight that will be lifted off your shoulders if you didn’t have all that debt weighing you down?!
Write down a list of all the debts you may have. Start by paying off the smallest debt first. When that is paid off, roll that payment and any additional funds into the monthly payment on the next debt on your list. This is called the snowball method and is an easy and effective way to manage your debt solution.
You can borrow online to pay off debt and have a single payment if that makes it easier on your budget.
Make Tough Decisions
Every bill and expense has been written down. Are you still coming up short? If so, then this is the time to be an adult and make some hard decisions.
What can you cut out this month? The first things that need to go are items in the wants category. You can make coffee at home instead of purchasing the morning cup on the way to work.
Maybe you eat leftovers to cut the grocery bill. You forgo entertainment for the month, get creative, and find free events around town for the month.
I understand that if you are swimming in debt or think it’s too late or hard to start a budget, you are wrong! Having a printed monthly budget will let you physically see where every dollar is going and be a way to get a handle on your finances.
At the start of every month, re-write your budget as expenses can change. Once you get into a routine and habit of sticking to your budget you be on the right financial track!