Budgeting Problems?
Alright, let’s talk about budgeting. Maybe one of the most hated words in our vocabulary.
It doesn’t have to be complicated. But what it does have to be is … managed.
Start with these five steps, and you’ll actually know where your money’s going for once. You can throw all these in a simple Google Sheet or XLS. Or if you’re a pen to paper sort of person, you can do that too. Just remember, it’s a whooole lot of numbers.
Know Your Income: Start with how much you actually bring in each month. After taxes, of course, because nobody budgets in fantasy dollars.
List Essentials First: This means rent, bills, groceries, and any other non-negotiables. Add them up, so you know the baseline amount you can’t go below.
Set Savings Goals: Think about short-term and long-term goals (emergency fund, vacation, down payment, whatever floats your boat). Aim to save at least 15-20% of your income, but remember this percentage can change too depending on your goals and/or where you are.
Plan Fun Money Carefully: Entertainment and “fun” expenses are where things can go sideways, so be specific here. Decide on a set amount, and, more importantly, stick to it. Don’t just bucket everything into “miscellaneous” because that will end up being a big bucket. I see you Target and Dollar Tree shoppers!
Track & Adjust Weekly: At the end of each week, see where you’re at. Did you overspend? Under-save? Adjust as you go so you’re not blindsided at the end of the month.
If you really want to go above and beyond, download the last three months of your bank and credit card statements and categorize all your spending. I assure you, you will be surprised at what you find.
If you want to use a budgeting app, that is helpful too. I use EveryDollar although I am on the hunt for another one.
I’ll dive deeper into the world of budgeting on another post. There’s so much to review on this topic!
