I know, I know. You probably hate the word budget, much less the actual act of budgeting. It sounds boring and time-consuming, but it doesn’t have to be horrible. Here are a few tips to help you get your budget under control.
- Track your income and your spending. It doesn’t necessarily matter how you do it, just that you do. Whether you use an app or a spreadsheet, you need to be able to look at the numbers.
- Expect the unexpected. Expenses will come up, and that’s okay. One of the reasons we preach about emergency funds so much is that an emergency fund can keep you from completely destroying your budget over a big expense.
- Look at shorter time periods, a year or less. Your budget will change and evolve just like your life. A student will have a different budget than a married couple with children. Look at a month at a time, or even a week if that’s better and less overwhelming for you. Just don’t try and project out your total budget over more than a year or so since life and expenses can change over time.
- Be prepared to make changes. If you realize you’re spending $150 a month on TV, yet not watching it more than an hour or so a week, why not cut that expense and move it towards something else? A budget is a chance for you to look at where your money is going, and make it go where it works best for you.
- Add saving into your budget as a line item (or as many line items as you need for your different savings goals). It’s a great idea to go ahead and set up automatic contributions to your retirement plan or your savings account. That can help you project out your saving contributions, and see if you need to make any changes. It’s easy to just look at what you spend on expenses, and ignore your savings contributions. Saving is necessary to meet a lot of financial goals, and including it in your budget can help you track it.
It’s okay if you don’t love budgeting. That’s fine. You don’t have to love it, you just have to try. It may take a few different apps, spreadsheets, and months before you find what works for you, and that’s all part of personal finance. These are just a few tips to try and help you with your budget. It’s important to realize that what works for one person may not work for you.