The Secret to Budgeting the Easy Way

budgeting

The Secret to Budgeting the Easy Way

Not everyone has the time every day to balance their account, conduct their business banking, verify their online accounts, and determine how much money they have to spend on what.  Although those people do exist, most of the population falls into the category of lackadaisical money manager when it comes to their personal finances.  This is not to say that having and maintaining a budget is not important.  Quite the contrary is true.  There are, however, easier ways to go about it for those who have chaotic lives.  Here are a few easy tips for busy people who need to budget their finances.

Simple Budgeting Tip #1:  Make More Money than you Spend

It seems rather obvious, but many people still spend more money than they make, relying on credit cards to fill in the difference.  This is the goal of your entire budget-Don’t spend more money than you have in your bank account.

Simple Budgeting Tip #2:  Determine Where Your Money Goes

Before making any changes, determine exactly what you spend your money on.  This is where the truth comes out.  Whether you are spending too much money on movies or unnecessary trips to the grocery store, your spending habits will tell you everything.  Now you know where your overspending occurs and what areas you need to work on.

Simple Budgeting Tip #3:  List your Future Expenses

Although this step takes some planning, it is much simpler than calculating your funds daily.  Make a list of foreseeable expenses that you can predict within the next few months.  From new tires to your gym membership renewal, write down everything that will you need to buy within the near future and how much it will cost.  For many, putting down your expenses on paper can help you to plan ahead.

Simple Budgeting Tip #4:  Do Your Math

Take each future expense, and determine the approximate time before you will need to purchase them.  For instance, if you will need to purchase new tires in about four months, you would have the number four.  Take the total purchase price of the item and divide that by the number of months you have.  This will tell you how much money you need to save each month.  Simply transfer this amount each month to a savings account.  Some banks in California will even allow you to set up automatic transfers.  Set up the recurring transfer amount, and you can forget about having to do it each month.

Simple Budgeting Tip #5:  Put the Brakes on Overspending

Temptations are everywhere.  There are several methods to control overspending.  One involves determining how much money you need each week for items, such as groceries, gas and other necessities.  Allocate the money into labeled envelopes.  Once you spend all of the money reserved for the item, you are out for the week.  While you may need to organize the envelopes the first time, it will quickly become a habit and easier each subsequent time.

This day and age, learning the art of budgeting is a must.  There are, however, ways that you can customize and adapt your budget to meet your specific lifestyle needs.

Related Reading:

8 Painless Ways to Save Money, U.S. News

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