One of the first steps to financial success is creating a budget and managing it well. Whether you’re new to budgeting or a longtime user, it’s important to update your budget multiple times a year. The following are a few quick tips to ensure you’re keeping your budget as accurate as possible.
More Money, More Updates
If you recently earned a raise or got a new job, the first step to managing your budget is to make sure your listed income is accurate. This number will impact how much you can spend and save every month. It especially helps to include what your monthly income is after taxes so you have the most accurate picture possible when allocating funds.
Track Your Spending
A budget functions off of having accurate allowances for each of your spending and saving categories. Take a month and track every purchase – are you still averaging what your budget outlines? If not, adjust your monthly budget to realistically reflect what you spend each month, for example if you’re spending more than allotted on groceries it’s important to update your budget accordingly.
Plan Ahead for Unexpected Expenses
Did you forget to budget for something last year, like your kid’s dance costume or your boss’ birthday gift? Don’t let last minute expenses catch you off guard in the months ahead. Take a minute to adjust your budget where necessary to ensure you’re prepared for the easy-to-forget expenses ahead. One simple tip is to contribute $10 or more a month to a last-minute expense fund. That way when you don’t budget for an expense you can avoid throwing your entire month’s budget out of whack.
Cut Out Unneeded Expenses
When you review your budget, you may find a monthly purchase that’s not worth the expense, such as a streaming site. If you’re not getting your money’s worth, then say goodbye to that payment and free up space in your budget. Cancelling subscriptions is easy to do online, and you’ll have more financial freedom in upcoming months – hint: like adding more each month to your emergency savings!
Do you share a budget with a spouse or partner? Be sure you’re on the same page with where your incomes are going each month. There may be more effective ways to pay for your monthly expenses and to save for the future, like getting on the same phone plan, pooling in for greater returns on an investment product and more.
We get it, budgeting can seem daunting! However, by reviewing your budget every month to ensure it’s realistic to your financial needs, budgeting can be a breeze. Need help getting on track? We offer free financial check-ups in our branches or over the phone at 800.862.1998. Sign up today!