The ‘B’ Word
Budgeting is one most peoples’ least favorite subjects. This is probably because they were never taught how to make a proper and realistic budget.But, whether or not it’s in our comfort zone, we inevitably hunker down and try to crunch numbers and make a plan.
Here’s some tips for success this year:
Be Realistic: Making your plan too strict on paper so you can feel good about buckets of imaginary money you’re going to accrue in the near future isn’t going to help you in the long run. You do still have to enjoy living; try to keep that in mind so you can actually stick to the budget you set.
Are You Leaking? Are you trying to pick your jaw up off the floor after you’ve crunched the numbers from the past few months? Then there is a leak or two that you need to plug. Find it and adjust. For some it can be groceries and going out to eat. Where do you really spend?
The Little Things: The inexpensive dailies really add up. What is it for you? Coffee, lunch, magazines, Uber?
Make Substitutions: You don’t necessarily have to stop doing everything you love. Just find a better way to do it. If you love coffee, get a french press for home or work and start making your own instead of dropping the money at a coffee shop.
Go Old School: I think one of the most difficult things in keeping track of money is due to this cashless society we live in. It makes it so much harder to understand where our money disappears. The best way to not overspend is to carry cash whenever possible — out to dinner or to the grocery store, if you take out exactly what you have allotted for that outing you won’t be splurging on anything else cause you won’t have any more money to use. It’s an easy way to keep yourself on track and not splurge in the moment.
Buy In Bulk: Do it anyway you can. If it’s with boxed or canned items, household supplies, or anything routinely used it can really make a big difference in the long run.
Cut It Out: What monthlies can you live without? Do you really need Netflix and Stan AND Foxtel? Get rid of something for a month or two and see if you really even miss it. Something more interesting might just fill its space. Don’t worry! If you really feel the loss, you can always go back.
Auto Savings: If you are not great with transferring money into your savings account let the bank do it for you. Set up an amount you know you can save each month or paycheck and set up an auto transfer. You can always change it or cancel it for a period that you will need more money.
Treat Yourself: Make a list of small inexpensive things you can splurge on. Something out of the ordinary to look forward to. Set a small price limit, allot for it and choose one each week or two. It’s like a little pat on the back for keeping up with your budget. If you just keep denying yourself over and over you will get worn down and not likely stick to the constraints you’ve made.
The most important part of budgeting is setting yourself some important goals that you’d like to achieve by sticking to your budget. For example “save for a home deposit in 2 years”, “buy my first car debt free in 3 years”, “go on a European holiday in a year without using a credit card” for what or why you are saving. Without a tangible goal in place, you will quickly get off track and it won’t bother you as much. Keep yourself accountable and you will achieve those goals faster.