It can be difficult to keep on top of budgeting, particularly if you have multiple debts and repayment schedules to keep track of. In this guide, we will share with you some helpful budgeting tips that will go a long way in getting your finances back on track.
Put Your Debts First
When budgeting, the most important thing is to always put your needs before your wants. This means that expenses such as grocery shopping and bills should always be at the top of the list, followed by debts. Do not let your debts weigh you down, it needs to be a top priority if you are to get rid of it as soon as possible.
Budget to Zero
Relax – this doesn’t mean that you have to spend every dollar of your income. It simply means that every dollar has to be accounted for, whether you are spending it on necessities, paying off debts, setting aside emergency funds or spoiling yourself. When you have a clear idea where every dollar belongs, there is less chance of misspending.
Turn to Cash for Categories Where You Tend to Overspend
If you find that you tend to overspend in any particular category, such as shopping, the best way to get it under control is to withdraw the exact amount of cash allocated to that category. That way, once you have spent it all, you will know immediately that it’s time to stop.
Take into Account Seasonal Needs
Although you have to be disciplined with budgeting, there has to be some room for flexibility. Inevitably, there will be months where your expenses are higher than usual, such as during the festive season. Chances are, these additional expenses do not come out of the blue. You know they are going to arise, so make space in your budget for them!
Set Aside Some Miscellaneous Funds
We never know when an event or accident may occur that necessitates the use of emergency funds. As such, it’s always best to be prepared. Every month, set aside some miscellaneous funds which you can fall back on in case of an emergency, such as if a family member falls sick suddenly. That way, you do not have to dip into the funds allocated to other categories and your budgeting will not take a huge dip when push comes to shove.
Trim the Budget When Necessary
Sometimes, it can be necessary to make some trims to your budget that you are unused to. If you are used to eating out twice a week but are faced with an unexpected emergency, the best way to free up funds for that is to cut down on dining out. Take heart that this change does not need to be forever – you can adjust your budget back to what it was before when the emergency has passed.
Try Out Online Budgeting Tools
If you have trouble keeping everything together, have you considered trying out an online budgeting tool? There are also some budgeting apps you can download on your smartphone, with one advantage being that you can sync data with your spouse!