Learning ways of budgeting your money properly can be difficult, especially if you have never done it before. Learning to do it well will take time and discipline. It will also mean that you have to change your habits. Here are a few tips that can help.
Pay Necessary Bills First
There are certain bills in life that you have to pay in order to live comfortably. Rent/mortgage payments, utilities (gas, electric, water), phone, and groceries. You should always budget money to get these paid. The rest are luxuries. Yes, your cable or satellite bill is a luxury, not a necessity. Your smart phone is a luxury. You only need a very basic phone that can make phone calls. Keep this in mind if you ever get into a financial crunch. There are some things that you can do without and if money is really tight, think about getting rid of the luxuries.
Have a System
If you get paid every other week, decide what bills each paycheck is going to pay for. Most bills are due at a certain time of the month. Check to see what that date is and setup a schedule so that each bill gets paid on time. Instead of simply spending the remainder of your paycheck, make a conscious decision about what you want to spend that money on. Perhaps you want to save for a special item or vacation or maybe you want to use that money to pay down your debt. Setup a certain day of the week when you pay bills and deal with your financial affairs. Schedule it as an appointment on your calendar. If weekly does not work, try twice a week or even daily until you get budgeting your money under control.
With many banks, you can setup a schedule for transferring money from your checking into your savings. Setup an automatic deposit from your checking account into your savings account for a certain day each month. Make sure that it matches your system so that you know which paycheck that money will be coming out of. This guarantees that you will save at least some money each month.
Scheduling some money to go into an emergency account helps you to deal with the unexpected of life. Emergencies happen and unless you plan for them, you’ll end up going into debt to pay for them. Cars break down and kids sometimes end up in the emergency room. Start putting some money aside each month to cover things like this and only use the money for true emergencies.
The biggest tip for budgeting your money that I ever received was this piece of advice: Don’t spend money that you don’t have. If you follow that simple advice, you will not get into debt and you will live within your means.
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