Does hearing the word “budget” sound intimidating to you? Having a budget can actually be quite liberating and freeing for you as a consumer. Knowing where you stand financially each month, what you can or cannot spend will help you to put limits on your life and help you to live within your means. Living this way is best because it puts YOU in charge of your finances instead of letting your finances CONTROL you.
What are some ways you can create a workable budget that is fitting for you? Here are some steps to help you on your way:
- Keep track of your expenses for one month. Knowing how much you spend, can help you set up realistic amounts when choosing numbers for your budget.
- Create a “trial” budget. Set up a budget based on your expenses and income. Look it over, get input from other family members, and start trying to implement it.
- Budget realistically. Even though you need $400 for food each month and you only budget for $300 know that you are going to have to pull that extra money from another fund. Consider cutting back on areas other than your basic staples for living.
- Set up an emergency fund. Even if it is $25 per week, that adds up to $1300 a year, a sizeable amount to cover unexpected emergencies. Keep this fund, for emergencies ONLY. This is imperative because things come up and your only other option is to charge it. You don’t want to be in debt for something you can plan ahead for.
- Revise your budget. Are their areas where you can improve? Are their areas you need to cut out? Maybe selling that gas guzzler and getting a more fuel efficient car is the answer. Seeing your expenses on paper is a great way to reevaluate where your money is going.
A great phrase to learn is “NO, it is not in the budget.” Your children and spouse will learn to live within a set boundary. Practice self-control until it becomes ‘the norm.’
A little planning and self-discipline will help you to become financially sound. Your children will benefit from your example as well.