Budgeting Tips

Budgeting Tips

If your money situation is getting out of control, you need to buckle down and come up with a budget that really works. Perhaps you’ve tried making budgeting spreadsheets in the past but after a month, you stopped following it because it was too unrealistic, or because you didn’t have time to track spending.

Whatever the case, now’s the time to come up with a workable budget that will get you back on track. Check out these tips on how to budget wisely.

Know Your Goals

The goal of your budget isn’t necessarily to track every penny spent. You can budget that way, for sure, but it shouldn’t be your main goal to account for every single cent. In order to have an effective budget, you first need a goal. That could be saving for college, a house, retirement, a wedding.

Whatever the case, the end result will be to control your spending so you spend less than you make. What you do spend should be on what matters most to you.

Track Spending for a Week

Tracking where your money is going in general for one week at the start will be helpful. This way, you can see where your money is being spent, and reveal areas of spending that you would otherwise not notice. This will give you valuable information about your spending patterns.

Use a 3-Category Budget

So as not to get overwhelmed, pick three main categories to budget for, such as:

  • Eating out
  • Buying clothing
  • Entertainment
  • Buying electronics and gadgets
Budgeting Tips

Most people overspend in areas such as these. The point of your new budget isn’t necessarily to track your fixed expenses (groceries, utility bills), but the things that actually change your behavior.

After picking three categories you want to bring under control, you can more readily monitor your spending and experience a significant impact on your finances.

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