6 Painless Ways to Kick-start Your Budgeting RoutineAug 05, 2020
You’ve been a hard earner all your life but when you check up on your savings, your heart skips a beat.
Where did all the money go?
Sound like something you say often? You are probably one of the large numbers of Americans that have poor budgeting habits.
According to Gallup, only 30% of US households have a long-term financial plan.
It doesn’t matter how much money you are earning; the real indicator of freedom is the purchasing power you have based on your savings at any point in time. For steady savings, you need a killer budgeting routine to keep you on track. A detailed budget will steer you clear from large debts, boost your credit rating, and help you cover for emergencies when they come!
Don’t worry if you don’t have a clear budget yet. So many like you have missed out on the right financial advice all these years.
Here are 6 no-brainer ways to help you build your way straight from a money mess into pro financial management mode.
1. Refresh your financial well-being
Research shows that people who are born into poverty, remain poor all their lives. That’s not meant to happen as a rule of nature. In fact, it is true only because people undermine their ability to achieve more than they already have.
You need to stand up for yourself and adopt a money mindset that guides you towards financial wellbeing. You should have the freedom to make choices in your life and that can only happen if you rethink the financial decisions you make on a daily basis. Remember, your income is not your limit.
2. Become friends with money
Statistics from the Federal Reserve Bank of Atlanta show that people with low financial literacy are late to their mortgage payments 25% of the time. This is just one way in which poor financial knowledge hurts you, among many others.
Financial literacy is not something you can ignore anymore. It’s when you get to know your money when you learn to manage it well. So, get out there and acquaint yourself with money management terms and methods that no one taught you at school.
Opt for online courses by financial advisors and learn directly from their professional, life-long experiences. Here’s a course I have designed to help people become financially fit and make money management an integral part of their lives. This knowledge will empower you to manage money wisely and challenge what large corporations tell you about your own money. (Hint: It’s not the truth!)
3. Start counting those dollars
If you work more than one job, or you are a freelancer, chances are that you are unaware of your exact income per week or month. In that case, you need to sit down with yourself right now and pen those numbers down.
Make it a habit to check bills and bank statements regularly so you know how much is coming in and going out. Know how much you’ve been spending and saving on average each month to get a better idea of your current financial standing.
You may be in for a few surprises when you do this as many of us tend to wrongly estimate how our money is flowing!
4. Make a spending plan
Take charge of your money by writing down everything you know and do. Make a plan that shows you exactly how much money you should be spending and saving. Debt payments need to be taken care of right at the beginning if you want true financial freedom.
Your budget should also have a clear savings goal, as well as an investment plan that will help your life a more comfortable life. Categorize your expenses and make sure you know which areas suck up the most cash in your life. Then ask yourself if it's truly worth it.
The key is to plan the numbers in advance so that when you go out to make a new purchase, you know exactly how it will play out in terms of budget targets.
5. Track progress regularly
Who said budgeting was supposed to be hard? With technology at our disposal at all times, we are pretty much covered when it comes to money management. Not only do they help us do the math and present our numbers smartly, they help us stay on top of our goals.
Automate your spending plans and budget by opting for apps on your mobile phones such as budgeting planners and quick cash finders that do a pretty good job at handling your money for you. So the next time you think you are slacking, tank up the volume on your phone and get those money notifications coming in!
6. Reward yourself frequently
Budget slip-ups will happen. So, when you have exhausted the first 4 steps, I want you to relax and give yourself a break. Healthy money habits take some time to develop but offer lifetime benefits for you and your family!
Don’t beat yourself over if your savings are lacking by a few dollars. Learn the lesson and do better next time! When you have some extra cash, reward yourself by getting the favorite dress you had been so long for - it’s a personal accomplishment!
Remember, like everything else, your money demands attention and persistence. Stick with your budget and celebrate every little bit of progress you make no matter how small. You deserve it!
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