- By p1fcu
- Posted on January 5, 2018
- 0 comments
The start of a new year causes many of us to revisit aspects of our lives that could use a tune-up and for plenty of people, that means creating the right budget to keep your finances on track. Setting financial goals is pointless if the planning and prep work is nonexistent. Budgeting can be a great tool for keeping you on target and confident that you’re accomplishing all the right tasks.
Budgeting Truth #1: Everyone Needs a Budget
It’s easy to think that a budget isn’t necessary, or that others aren’t budgeting so why bother, but it’s simply not the case. Budgeting allows you to create a spending plan for your money, and ensures that you will have enough money for what you need. Maintaining a budget is a great way to stay out of unnecessary debit, or help work your way out of current debt.
Budgeting Truth #2: Be Realistic
No matter the reason for creating a budget, you should always ensure that your budget makes sense for your income level and current needs. Find out what you spend week to week, and be realistic about where you can make cutbacks.
Budgeting Truth #3: The Focus on Saving is Powerful
When developing your budget, always plan for money to go into savings; after all, you should be rewarded for being smart with your money! It’s a good idea to create separate savings accounts for each goal, as well as having an emergency fund for times when life happens. You can set up automatic transfer for this, so that the money is transferred without any hassle.
Budgeting Truth #4: Cut Yourself Some Slack
Budgeting is not for the faint of heart – it’s a challenge and can take several months to really take off. If you find you’ve underestimated your expenses, revisit the plan and see what needs to change. Be diligent about your spending and keep track of expenses so that you can start hitting your goals.
Life is full of unexpected occurrences, but developing a budget can take some of the stress out of those happenings. Remember, it will be trial and error and you can try out several different methods to discover what works best. The important part is that you’re aware of your finances and making smart decisions about how to spend your paycheck. No one will judge you for your crazy, off-the-wall method of budgeting; they’ll be too busy getting jealous over the fact that you have your finances in order and can spend without worrying!