Create a Budget and Stick to It

Are you unable to save money? Does the fear of unexpected expenses keep you awake at night? Are you sick of living life paycheck to paycheck? Getting out of that pattern is easier than you think. Create a budget. It will force you to make more responsible decisions and it will help you achieve your financial goals.

Budgeting made easy

Get a small notebook and start documenting everything. Each page of the notebook will be dedicated to a different component in building your budget.

  • Step one: Determine your take home pay for one month including dates paid.
  • Step two: Write down all of your monthly expenses- fixed, variable and periodic. 
    • Fixed: stays the same each month i.e. mortgage and car payment
    • Variable: monthly purchases that differ in amount i.e. groceries and gas
    • Periodic: expected and unexpected expenses that are not due monthly i.e taxes and home repairs

Here's something to use to help you complete these steps. Expense and Income worksheet

  • Step three: Develop a payment and spending plan
    • Arrange the due dates of your monthly bills from first to last
    • Calculate weekly spending needs- groceries, gas, variable expenses
    • Determine your pay dates monthly
    • Match bills and expenses to coincide with your income. Consider changing due dates if necessary.

Stick to your Budget

Once you have created a budget, you now need to stick to it. Set aside a time every week to monitor your spending to see whether or not you are sticking to your budget. You might be surprised to how quickly the small things add up to big money. Below are a few ideas that might help.

Adopt new habits and modify your behaviors

  • Never have more cash in your pocket than you need. You will be less likely to over spend.
  • Understand exactly what you tend to splurge on, and constantly remind yourself of it.
  • Learn to think about what you will have to trade off in order to make a purchase. Then weigh the importance of the purchase.
  • Write down your financial goals and carry them with you at all times.
  • Ask someone that you trust to help keep you on track and remind you about your goals.
  • Additionally, a clear understanding of wise spending techniques will help you stay on track. Click here for some helpful tips.

Make a commitment. Take control.

Modifying your behaviors will be tough at first, but it quickly gets easier. When you're creating your budget, think of it as a road map to your financial goals. Time goes by quickly. One year from now you will be amazed by how far you've come and how much you've accomplished.

Consider a Debt Management Program if your expenses are out of control.

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