While I’m taking a bit of a hiatus this summer to write a book proposal and an ebook, I’ve invited a few people to guest post. Here’s Cassy from Credit Donkey sharing some tips for staying on budget.
If you’re anything like me, you need a little help sometimes staying on budget. Right now, I’m hanging out with a cup of coffee from good ole “Fivebucks,” which I really didn’t need to buy. In fact, that one small purchase pushed me a bit over budget in one area.
Why did I make the purchase, then? Well, I sort of forgot where I was at in the “dining out” portion of my budget. So now I have to scale back on something else in order to afford this cup of Joe I’m already enjoying.
It’s not that big a deal, but little things like this can add up over time. Maybe I need to use a few of these reminders to help me stay on budget:
1. Check your bank account balance
If you’re living on a tight budget and don’t have much of a pad in your checking account, you’re not alone. Lots of us in this tough economy are living paycheck to paycheck, which means there’s not much in-between to work with. In fact, the national average checking account balance is just under $3,000.
Checking in on your checking account balance daily is easy if your bank offers online and mobile account balance information. And keeping tabs on how much cash you have on hand can deter unnecessary spending – especially if that balance begins to dip below a comfortable level.
2. Track your credit card swipes
It’s easy when using a credit card to forget how much you’re spending, but you don’t want to fall into this financial trap. Whether you are using a credit card at the gas pump, or using a card to save money on grocery shopping trips, you still want to stick to budget to avoid paying hefty interest fees down the road.
So keep a notebook handy, and track your credit card spending each time you make a purchase. It doesn’t take long, and you can enter that information in your budget spreadsheet once you get home.
3. Use budgeting apps
There are literally hundreds of budgeting apps available today, and you may want to check out one of these money management apps to help you stick to your budget. Some of the more advanced apps actually download transactions automatically, so you don’t have to even write them down. Others simply help you keep track of where your money is going.
Budgeting apps on your phone can be particularly helpful for controlling day-to-day spending, since they allow you to check your balances and budgets on a minute-by-minute basis, if necessary.
4. Post a picture of your goals
One thing that keeps me going on my budget – and generally steering clear of expensive coffee shops – is keeping my goals in mind. I’m currently saving to buy a home. What’s your big financial goal to work towards?
Whether it’s being debt-free, going on vacation, or even something as simple as having an emergency fund, keeping the end goal in mind can help boost your will to stay on budget. Post a picture or a saying about your goal on your fridge, by your computer, or on your desk at work to keep these goals constantly in mind.
5. Set a reasonable budget
This tip actually begins at the beginning: when you’re setting your budget. If you find yourself constantly going over budget in certain budget categories, the problem may actually just be your budget.
Sometimes in our zeal to save more and spend less, we set unreasonable budget restrictions we just can’t meet. Now, if you’re constantly overspending on shoes you don’t need or on frothy, expensive coffee drinks, the problem probably lies in your self-discipline.
But if you’re spending more than you budgeted on your grocery bill, gas, utilities, or other necessary expenses, you may just need to re-examine your budget. Allocating more money to these problem areas can give you a more reasonable goal to meet, while still helping you save money.
Before I swipe my card at the Starbucks drive through, I’ll now have to contend with a mental picture of my dream house – and I’ll check that possibly low checking account balance. Which of these five tips will you use to stay on budget this week?
Cassy blogs about personal finance and how to be more financially savvy at CreditDonkey. For more information, please check out their website at http://www.creditdonkey.com/ or their Facebook page at https://www.facebook.com/CreditDonkey