In our previous two articles, we covered steps to creating a personal budget and effective strategies for successful budgeting.
In this article – our final article in this budgeting series, we will be looking at budgeting tips to help you budget successfully. These tips will help you tie in and integrate everything we discussed in the previous two articles mentioned above.
Creating a budget and finding the correct strategy for your monthly budget are the first steps to successful budgeting but could easily mean nothing without ongoing efforts to make sure you stick to, improve, and reassess your budget. Herein lies true budgeting success.
Setting up automatic payments is one of the most effective ways to make sure you don’t accidentally spend the part of your income that you should be saving.
These automatic payments can go to your savings accounts, investments, or retirement annuities. You can also set up automatic payments for other debts such as clothing accounts, student loans, or credit cards.
Either way, automatic payments ensure you stay on track with your monthly savings, payments, or repayments without having to think about them too much. This strategy also allows you to know what your spending limits are, as you cannot spend more than what comes off your account each month.
It’s much easier to follow directions given to you by a map or GPS than it is to guess your way to a new destination. The same applies to budgeting.
By setting specific goals, you are more likely to stick to your budget. With a goal as broad as “saving money” you may be more inclined to spend the money you should be saving. However, when you are “saving money for a deposit on your dream home” or even if it’s just to buy the laptop you need to perform your job efficiently, having a specific goal to save towards will help you stay on track.
Try to revisit your monthly budget so that you can identify areas that need changes or improvement.
Each month, look at the previous month’s budget and take note of areas where you may be overspending, and commit to gradually cutting back on spending in that category each month until you reach a happy medium.
Then, focus on the next category and make small changes to improve it. Once you are happy with your budget and how it’s working for you, you can set a reminder to reassess it on a quarterly or bi-annual basis to make sure you stay ahead of the game.
Whether it be a journal and pen, a mobile app, or a self-designed spreadsheet, finding a budgeting tool that works for you as an individual is extremely important.
Budgeting tools are designed to make your life simpler and tracking your spending habits easier. If you find yourself feeling frustrated with the tool you are using, perhaps it’s time to look around for something more appropriate for you.
When you budget, you are forced to evaluate what is important to you so that you can compare that to your spending habits.
Once you understand where your priorities are, you can allocate and spend money in those areas without guilt while cutting back on spending money on things that you don’t really care for.
If your budget is aligned with your goals and values, it becomes much easier to stick to.
We know how daunting budgeting can feel to many individuals. However, with the help of our financial advisors, you can develop a bullet-proof budgeting strategy that will help you achieve your goals, no matter how big or small!
Our financial advisors in Johannesburg are dedicated to helping you with your personal financial planning, a process which ensures your financial success.
If you would like more information about budgeting or any of our financial services, please don’t hesitate to contact us.
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