This month is all about budgeting. You’ve done your taxes and got an unexpected bill and now you want to plan accordingly throughout the year. Perhaps you’ve gotten a big return and want to spend it wisely. Maybe this is just the year you’ve decided to get your finances on track and reach those long term goals you’ve been thinking about. Either way, this month I’ll be sharing various tips and strategies to organize, budget and spend wisely. Maybe you can use some of these methods to help you save for that relaxing summer vacation you were hoping to get around to this summer!
Last week was all about the 50/20/30 strategy. It’s just a simple guideline to make sure you have enough money to save and enough money to play, without going overboard on either! Now that you’ve sat down and considered your budget, what’s coming in and what’s going out. It’s time to start putting it to work! Here’s a week by week checklist to help you implement your goals.
Before the 1st of the Month
Set your budget goals by following the 50/30/20 rule. Decide how much of your budget will go toward necessary expenses. Allocate the leftover budget to your goals, according to priority. Remember, It is up to you to decide what goals that extra money will go towards. How quickly would you like to build your emergency fund? Was there a large purchase you were hoping to save for, like new living room furniture? That’s the excitement of building your own budget. They’re your goals, and you get to meet them in a financially responsible and sustainable way.
Week 1
Follow your spending carefully the first week by downloading a financial tracking app or using your online banking tools. The first week of following this budget is where you can find the spending that slips out from under you. Perhaps your Starbuck’s tab is a little higher than you thought. These things are fine, you can either decide to cut back to save a little extra money for other goals or work it into your “extras” category. Don’t wait to fine tune the initial outline of your budget.
Week 2
You’ve been super conservative the first week, trying not to go overboard on spending, and now you’re getting antsy. Before you blow the rest of your play budget for the month think of the next big expense you have coming up. For example: That vacation! There’s no sense in blowing all your play money on new sunglasses, hat and bathing suit for a beach vacation you can’t afford anymore. Setting aside a little money at a time will save you from the feast or famine financial conundrum so many people find themselves in. Instead of shopping or eating out, spend that time researching your travel interests and figure out how to spend your well saved money on location!
Week 3
Check in on your ratio goals. Now that you’ve almost made it through the whole month, check back in to make sure you’re meeting your savings goals. Have you made those transfers into savings automatic yet? Sometimes you can focus so much on not spending, you forget about putting the extra away. If it’s sheer willpower to not spend your extra dough, make those savings transfers right away so you don’t even see them! Out of sight, out of mind, until Maui.
Week 4
Congratulations! You made it through the month. Now check your monthly statement. Did you fine tune your budget enough? Make sure to adjust your goals for next month as well as reward yourself for your success! Try that new restaurant you’ve been hearing about. See, goal oriented budgeting isn’t so hard after all!
Take a sigh of relief and repeat.
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