6 Practical Tips for a Perfect Budget

Budgeting isn’t exactly something that most people look forward to.

Finding the time to sit down and address your spending each month can be exhausting, particularly if you’re stressed about money. However, simply ignoring the problem and hoping it goes away isn’t something that works for people in search of better financial health.

If you want to achieve your savings goals, get rid of your debt, and make sure that you’re in a better place, both mentally and financially, then you need to create a budget. The good news is that it’s easier than you might think. Here are just some practical tips that should help with your budget.

Budget as a Family

While it’s tempting to try and do the majority of your budgeting alone, the truth is that you’ll find it’s much easier to manage your money as a family unit. If you’re married, you’ll need to sit down with your spouse and make sure that you’re both working towards the same goals. You’ll also need to come to terms on the things that you’re willing to compromise on. This should help you to avoid financial arguments in the long-term.

If you’ve got kids that are old enough to understand money too, it’s worth talking to them about your financial goals and letting them know why you’re sticking to a budget. This makes it easier for them to understand why you have to say “no” at times.

Remember that Every Month is Different

Some people struggle when they try to create their budget for the entire year at once. That’s because every month comes with its own unique expenses. There are certain times in the year where you might have to save more cash back for birthday gifts and parties, and other months where you’ll have to stock up on back-to-school supplies.

At the end of each month, sit down with your partner and think about the unique things you’ll need to budget for in the months ahead, and how you can work these costs in with your standard expenses. It may help to keep a list of regular and irregular expenses on hand to guide you.

Start with Important Expenses, then Work Your Way Down

When it comes to figuring out your outgoing costs, think about your most important expenses first, such as the money you put in your retirement and savings accounts, as well A the costs for food, clothing, utilities, shelter, and transportation. Once you’ve got those categories out of the way, you can begin to look at other areas like entertainment and fun.

Remember, it’s important to leave a little wiggle room in your budget for fun expenses, otherwise you could end up restricting yourself too much, and pushing yourself to fall off the wagon.

Work on Paying Off Your Debt

The less you have to spend on interest each month, the better off you’ll be. When you’re looking into loans, even if you have bad credit, make sure that you compare the options available to you to ensure you’re getting the best deal. Once you have your loan, look for ways that you can pay off the money you owe as quickly as possible.

The faster you can get your debt paid off, the faster you can start putting the money you spend on your repayments towards other goals and monthly expenses.

Stick to a Schedule

One of the easiest ways to ensure that you stick to your budget, is to make sure that you have a solid schedule to follow. Pick a day at the end of each month when you can sit down and prepare for the next budget. You can also set dates throughout the year where you look at your budget in closer detail and decide whether you need to make any changes to your savings goals.

Other ways that you can add scheduling to your budget include setting specific days for direct debits to come out of your current account. For instance, if you pay for all your must-have expenses first thing after your salary goes into your bank account, you’ll be less tempted to spend money you don’t have.

Create a Budget Buffer

Finally, make sure that you put a small amount of cash aside each month for expenses that you might have forgotten about. After all, no matter how organised you are, we all forget about little things from time to time. Label your buffer as a “miscellaneous” category in your spending, so you know you can use it for anything unexpected that crops up. The buffer should stop you from breaking into your savings.