Let’s go through a few budgeting principles:
- Saving: The bulk of budgeting pains happen at the beginning. When you start budgeting, it will be a little difficult, but once you get the trick to it you would see results in no time. To effectively save money, you need to know where your money is going and weight that against your value scale. Look at your phone bill, luxury spending like (outings and pleasure shopping); you might need to cut back on these luxuries to be able to meet your saving goals.
- Tracking: One of the important things about a successful budget is tracking what you spend. And, it doesn’t sound like a lot of fun. Certainly it’s not, because it involves detail record-keeping of even the smallest things. Every little expense in your budget can sneak up on you later, and then you’re asking the age-old question, “Where did the money go?”
- Practicing: Like everything in life if you want to be good at something you must practice and keep at it. Practice makes perfect. After you have a budget in place and you have fine-tuned it with a couple of months of actual spending, tracking your expenditures becomes almost automatic. A lot of people have unrealistic projections. If you are determined to make budget work, then you’ve got to be realistic. Don’t start off trying to save 50% of your income, especially when you have dependants to take care of. You have to make realistic budgets based on your circumstances.
- The key to spending within your means is to know your expenses and to spend less than you make.
- If you find you aren’t able to follow your budget successfully, it may mean that your plan isn’t flexible enough. It can take revisiting your budget a few times to find the balance that works for you.
- Stop mindless overspending Life is full of temptations
- “Always pay yourself first” – by this I mean set aside your savings.
- Plans for any future children’s education, your first home or your eventual retirement must be included in your budget. These are longer-term goals we all have to plan for. And these goals are attainable provided you plan for them properly
The more thought and planning you put into the ways you manage your money, the more options you give yourself to make wise money choices.