Penny-Pinching Series: READY-SET-START ~ Guide To Starting A Budget ~
Starting a budget can seem like an exhausting task but it doesn't have to be. I will give you simple tips and tricks that you can use to get started......the EASY way. So kick back and grab a snack.
Remember you CAN DO THIS!!!!!
Some people think that actually starting is the hardest thing to do when really it's maintaining your budget that's the hardest. Anyone can start a home budget but being disciplined enough to not get burnt out that's the trick. Luckily I'm going to help you and we're going to keep it simple. So let's get started.
1) Start An Adult Allowance
I can already see the shock in your face. But......Allowances aren't just for kids. Here's how it works. LEAVE YOUR DEBIT/CARD CARDS AT HOME!!!!! Yes, you heard me. The main mistake we make is not watching what we spend so we get to swiping and next thing you know you've run up $200 in one day. Look it happens. Pick a day that you want to pull out CASH....yes CASH....and that is going to be your Allowance for the whole week. Normally I would say to pull out $50 per adult. Whatever that person needs to buy for themselves during the week goes out of their allowance and not out of the checking account.
For more information on the Adult Allowance, click the link below to read the blog post.
2) Understand WANT vs NEED
I'm about to get really honest with ya'll. There are several people out there, myself included, that struggle with understanding the difference between what they WANT vs what they NEED. You may NEED food, but you don't need $200 worth of food per week. You may NEED shoes, but you don't need 20 pairs of the most expensive. So I challenge you to write down the things that you NEED and the things that you WANT and compare them. Cause 9 times out of 10 the reason you're having trouble saving money is that you don't fully understand the difference.
For more information on WANT vs NEED, click the link below to read the blog post.
3) Know Your Bills
We all have them and we hate paying them. You should know at all times what bills you have, how much they are, and when you have to pay them. I suggest writing them down or build you a spreadsheet. The BEST way I've found to keep up with my bills is using the Google Calendar. I have all our bills on the calendar on the date that they need to be paid. It's very important that you're paying your bills on time. Don't get stuck with those late fees if you don't have to.
For more information on your Bills, click the link below to read the blog post.
4) Know Your Debt to Income Ratio
Do you know what your Debt/Income Ratio is? Debt would be all your household expenses such as your mortgage, property tax, and homeowner's insurance. But it also includes credit card debt, installment loans, student loans, auto loans, and any child support or alimony you pay. So keep that in mind when considering your debt. Income is ALL income you receive. This could be your income from work, a business you have, and alimony or child support you receive.
Monthly Debt Payments / Total Gross Income = Ratio
5) Keep a CHECKBOOK!!!!!!
Look, I honestly can't stress this enough. I understand that we're in the new age of technology that everything is digital but there's nothing wrong with keeping a checkbook. You should know EVERYTHING that is coming through your account at ALL times. Most people think this is crazy but it's not. I even have special highlighters for mine but we all know I'm extra...lol. It's important to keep a record of your account. Just trust me on this.
Alright everyone so that is my 5 tips on how to start a budget. You really need to get these things in order before you even get started. Yes, I know some people don't think these steps are important but it really is. Take some time and get started with this first. The rest will flow with ease. But definitely start the Adult Allowance now and lock them cards up!!!!! I hope you found this helpful.
YOU CAN DO THIS!!!!!!!
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