Finances aren’t easy to manage, and there are always times when you find yourself coming up just a little bit short. Keeping on top of your finances doesn’t mean you need loads of money either. It’s all about living within your means and using a budget to keep you on track. Previously you may have used short term loans to see you through a crisis, but if you’re able to budget and save, you might not need them anymore. However, creating a budget that you can actually follow religiously is difficult. So, here are 7 easy ways you can stick to your budget and see an improvement in your finances.
1. Make It Realistic
The first thing you need to do when making a budget is to ensure that it’s realistic. If you set one that’s extremely strict and leaves you with nothing to spend during the month, you’ll soon find yourself splurging and going off plan. When it comes to creating your budget, take a look at your incomings and outgoings, and then figure out how much money you have left over. You can then split this up into savings and money that’s actually for spending. Giving yourself enough to live on is crucial, otherwise, you’ll only feel like you’re missing out and end up going over your budget. Budgets are to help you live within your means, not take every ounce of joy out of your life. You can stick to a budget and still enjoy the little things at the same time, you just have to be more aware of your spending. If you buy a coffee in the morning, then it just means you have a little less to spend on dinner in the evening. This isn’t too much of a compromise either, so you’ll feel happy that you can still do both and see that a budget can work.
2. Reassess It Regularly
As well as making it realistic, you also need to ensure that you reassess your budget regularly. Your means may change, or your situation could improve, so therefore your budget could be adjusted appropriately. It doesn’t have to be every month, but it’s good to check back in every so often so you can ensure that it still works for you. You might even find that after your first month of budgeting, it doesn’t work quite right, so you could then re-evaluate it and make any changes you need. It could be something simple like you needed a couple of extra notes to pay for the groceries, which you can then include in your budget for the next month. Making changes and adjusting it to suit your current situation is one of the best ways to make your budget work for you in the long term.
3. Set Clear Goals
When you create a budget, you need to have clear goals in mind of what you want to achieve. It’s no use saying you’re going to budget without giving yourself a good reason too. If you want to save more money, then set a date and amount that you want to have saved. This way you’ll have something to work towards without feeling like you’re budgeting for nothing. Sometimes you may have to miss out on certain things if they don’t fit into your budget, but if you’ve got targets that you want to reach, they can boost your motivation and make it seem not so bad. You can even change up your goals once you reach them too, so don’t think that you can stop budgeting if you meet them. Set more targets and see how quickly you can reach them as well. Soon, budgeting will become second nature and you’ll love the feeling of achievement you get when you meet your goals.
4. Resist The Urge To Splurge
Budgeting can be a great way to save up for big purchases, so you really want to try and avoid them while you’re trying to stick to it. Try to stick to the necessities and do your best to avoid overspending. In order to stay on track, you need to ensure you don’t go over your budget and one of the most common ways people overspend is by splurging. If something isn’t in your budget at that exact moment in time, it doesn’t mean it won’t be in the future. Try to resist the urge to overspend and instead, put some money aside for the luxury thing that you want. Then keep putting little bits away each week until you have enough to pay for it outright. You may find that by then you don’t even want it anymore and you’ve saved yourself from an unnecessary purchase.
5. Find A Budget That Works For You
There’s no right or wrong way to budget really as there are lots of different methods that may or may not work for you. Some people like to only use cash when budgeting as they can physically see the money and handing it over can make it seem more valuable. Other people might like to move their money into different accounts, only keeping their daily allowance in their spending pot each day. This way can be useful if you tend to swipe your debit card and not think about how much money you’re spending. If you only leave yourself a small amount to spend, then you’re more likely to think before you buy.
6. Avoid Using Extra Credit
You want to try and avoid using things like credit cards and overdrafts while budgeting, as they’ll only make you short again the next month. Before you know it, you’ll be trapped in a vicious cycle and your budgeting plan will never work. Knowing that you have things like a credit card behind you can make you feel like it’s okay to overspend as you can just rely on your credit instead. However, this method will only lead to failure, and you’ll never be able to get a grip on your finances. Instead, banish your credit cards and do not allow yourself to go overdrawn. Act like these things don’t exist and you’ll soon find that you want to stick to your budget.
7. Plan In Advance
Sometimes budgeting might not work, especially if you’ve got a holiday or big event coming up. These situations can tempt you into splurging, so you want to do your best to try and avoid this from happening. The best way to combat overspending is to plan well in advance. Get your calendar and mark down every event, holiday, and birthday that will require you to spend money. This way you’ll be prepared for them, and you won’t be forced to go over budget. Put a little money away each week for these events and you’ll find it a lot easier to attend them without the worry of money looming over you.
Budgeting can seem like a scary thing to do, but really, it’s a great way to get a handle on your finances. At first, it can be hard to stick to as it’s completely different to how you’re used to spending. However, within a few weeks, it will feel natural, and you’ll wonder how you ever coped before. Try utilising these top tips and see the difference they can make to your wallet!