The quick answer is yes! A budget is like most things. If you don’t consciously make one then one will automatically establish itself for you based on your income and expenses. It’s like a business plan is to the business owner. And if you don’t have one, you run the risk of not realizing your financial dreams or potential. The mere act of writing things down gets your mind churning, something that’s a good thing when it comes to one’s finances.
Here are a few things you should do as you’re planning your budget.
Take a look at your current financial picture
When starting a budget, you want to first look at all your income streams and all your monthly expenses. Is either lacking? Are there any expenses dragging your budget down? Perhaps there’s a subscription or two that you no longer want.
Set some financial goals
You’ll want to set some goals so you’ll know where you’re headed. Your goals should include both short-term goals such as paying your monthly bills or starting a savings accounts, and long-term goals such as paying off a credit card and saving for retirement.
Make a plan to reach each goal
Oftentimes it helps to set a deadline. That’s why making a plan with a reasonable timeframe is important. If possible, tell someone close to you about your goals. Saying them aloud makes them real and talking to someone will help you remain accountable to your goal.
Strive for progress, not perfection
It’s easy to fall off the proverbial wagon and give up completely. Perfection is an all or nothing proposition, and once the line has been crossed, it’s easy to give up, especially when things get hard. But try to resist this way of thinking and focus on the progress. Even small moves forward is moving progress. You’ll have some wins and some loses, and that’s okay.
Set aside some fun money
When you’re creating your budget, set aside some fun money. It could be as little as $5 or $10 per month as your fun money. You can spend this money anyway you want without guilt. Need a pick me us from Starbucks? Perhaps a bouquet of flowers from the market? Whatever it is, go ahead, and remember no guilt.
Celebrate the small stuff
It doesn't mean for you to go and blow your savings once you’ve reached a milestone, but allow yourself small rewards here and there. The idea of a budget is to make sure you’re getting the most out of your money. It’s not to deprive yourself of life’s pleasures. On the other hand, it doesn’t necessarily have to be something that you have to buy.
What if you get off track?
If you get off your budget, don't beat yourself up about it. Make adjustments and jump right back on track.
If you're still struggling to make ends meet and stick to your budger, consider a side gig to bring in some extra income such as drive for a drive service, or take on a part-time job. A little extra income may be all you need to get yourself over the hump.
There are some apps out there that offer help for those who struggle with budgeting. Try Mint, You Need a Budget, or Pocketguard to see which one may be right for you. CDC Federal Credit Union is also here to help.
Tell us what budgeting moves you use to stay on track in the comment section of this blog post.