Budgeting can be tough. Life can be expensive, especially if you have a lot of interests and enjoy doing a variety of different things. In this article, we’re going to give you some tried and tested budgeting tips so that you can enjoy your life without financial stress.
We’ll let you know how to create a budget, keep track of your money, and stay on top of those pesky student loans.
1. Track your spending
We use technology for nearly every part of our lives these days. Whether we’re trying to get around a new city or arranging a meet-up with friends, we’ve always got a smartphone in our hands to help us out.
Modern technology is also a great tool for tracking your expenditure and budgeting effectively, which is the foundation of any making your money work for you. For example, spreadsheet apps make it extremely easy to track income and expenses – they can even do all the budget calculations automatically.
You can have a new spreadsheet every month to track your budget and separate it out into different categories. If nothing else, being able to visualize your money in this way can make it way easier to know where you are up to.
2. Automate your finances
Automating your finances is a way to simplify your spending and make it much easier to see how much money you have left. This stops your regular expenses from getting mixed up with the rest of your money, which can leave you in a mess if some unexpected expenses come in.
Most banks will allow you to set up direct debits for payments such as your rent. Some credit card providers will even let you have separate pots in your bank account for different monthly expenses, which helps you track your budget even more closely. Apps like Acorns, Moneybox, and Raiz will automatically roundup your spare change and invest it for you.
3. Pay the most important expenses first
This may sound obvious but prioritizing payments is something that a lot of people forget to do and that can actually help you out quite a lot with your money management.
Always try and pay off your bills and rent first and then start on the less important things. This simple change in your spending habits will take a lot of stress away at the end of the month and probably help you save money in the long term.
You could also think about putting an emergency fund in a savings account in case any important and unexpected payments come up.
4. Tackle your debt
Looming debts can be heavy weights on the mind. Taking care of debts is undoubtedly difficult and as the debt payer, you are always at a big disadvantage, especially if you owe a credit card debt. However, if you can, always try to tackle your debts as soon as you are able to do so.
Think about putting some spending money aside from your monthly income to contribute to your debts. If you continue this throughout the year then you’ll be in a much better position to pay off your debts.
For more on this, check out Dave Ramsey’s famous debt snowball method.
5. Set financial goals
If you want to improve your personal finance, then a big thing you can do is set some financial targets. Write down when you aim to pay off your debts and how much you want to save up. Make sure you work towards these budget goals and you’ll see short-term and longer-term benefits.