When it comes to money, anytime is a good time to review your spending habits and learn the importance of budgeting. For one, it helps you save for large planned expenses like vacations or tuition while allowing for those occasional date nights or escape weekends. But good budgeting skills also help you create a safety net to protect against the unexpected, like losing your job or dealing with a serious car repair.
If you want to learn how to budget, consider this article a Budgeting 101 class without tuition! Here are five budgeting tips to help you make the most of your money.
Set Budget Goals
If you’re dreaming of a beach vacation or a BMW car, don’t stop! Putting aside money for something you want or need, whether it’s a new car or a beautiful getaway, is a great incentive to save. Keep your eye on the prize by placing photos of what you’re saving for in an obvious location, such as on your refrigerator or work desk, to remind of your goals.
The first step for setting budget goals is to determine if your goal is long or short-term. Small, short-term budget goals are best for something fun and rewarding, while long-term budget goals like saving for retirement or your child’s education require more planning. You may want to consider consulting a financial planner for guidance with your long-term budget goals. Creating an emergency fund by saving and reducing your spending are other worthy goals that will benefit your wallet.
Build Up Savings
Add as much as you can when you can. One easy way to add to your savings is through automatic transfers from your paycheck. Even 10% of your weekly pay can build up your savings quickly. Another way is to add to your savings little by little throughout your week. For example, you can make your daily salad at home and transfer that $25 you would’ve spent into your savings as a payment to yourself.
Also, don’t spend more than you make. It sounds simple, but this is a common mistake many consumers make. If you live within your means, it’s much easier to avoid the pitfalls of credit card debt. Creating a monthly budget and tracking your spending goes a long way towards curbing your urge to spend more than you earn.
Be a Smart Shopper
The internet makes it very easy to shop around for the best price on an item, so plan ahead and look for the biggest savings. If there are items on your wish list, ask yourself if you can wait until those products go on sale. Holidays like, Fourth of July, Black Friday, and Cyber Monday are prime times for deals.
Additionally, take a look at the subscription services you have. Sure, they provide the convenience to shop, stream videos, and exercise, but their “set it and forget it” payment model makes it easy to pay for things we may have grown bored of or no longer use. Review your bank statement to see what’s automatically deducted from your account and then give your subscription services — if it brings you joy (and you use it regularly), keep it. Chances are, if you haven’t used it, you don’t need it. Don’t forget about any annual subscriptions you may have, such as magazines and phone apps.
Cook at Home More
Few things are quite as satisfying as a home-cooked meal. Cooking at home is a simple way to save money. Plan a weekly menu to set your shopping list and avoid extra trips to the grocery store. Cooking with family or friends can be fun, and preparing meals in advance allows you the convenience of a quick meal and saving money. And who knows, if you cook often enough, you may give Gordon Ramsay a run for his money lol!
Shop for Less Expensive Insurance
Auto, home, or business insurance rates are very competitive and change periodically. Keep your premiums down by reevaluating your policy and comparing rates at least once per year. It’s easy to make an appointment with one of our agents to ensure you have the right amount of coverage to protect you in the event of an unexpected loss, as well as determine if you qualify for any discounts to save you even more money.
With these budgeting skills under your belt, it’s time to do your homework and put them to good use. Applying this advice can help put your mind at ease and prepare you for financial freedom in the future. Hopefully, you’ll be well on your way to treating yourself to something special like a weekend away or a nice vacation.
If you’re looking to save money on your insurance, talk with an agent today to help you get a low rate on your home or auto insurance.