Budgeting might sound like a bore – and an outright chore – but your budget is really just a snapshot of your finances, ultimately saving you time and money.
Anything successful is built on a solid foundation and understanding. To be financially successful in life, the same is true – you need a good structure, and that structure is your budget.
Why budget?
Budgeting helps you control your finances and understand the movement of money in and money out. It allows you to keep track of your money, make changes to your spending and save for future goals.
Setting a budget, and sticking to it, can transform your life. I’ve seen folks who thought they’d never be a homeowner, pick up the keys to their dream home after sticking to a structured budget.
Make it a habit
When you are disciplined, you can transform anything in your life, and that includes your finances.
Budgeting is a habit, so you need to build it into your routine to achieve your goals.
Set aside time each month to go over last month’s expenses and spending – tracking money coming in and going out in a money diary, for example – and look towards what next month might bring. It’s also a good idea to keep some money aside for emergencies if you can.
Budget for success tips
- Track your monthly finances and spending
Get started with a pen and paper, or a spreadsheet, and track your usual spending over a week or a month including bills, repayments, rent, insurance, groceries, transport, and general living expenses.
- Use a budgeting app
Once you understand the budgeting basics and have it on paper, you can check out all the cool apps and tools available.
- Set a savings goal
Set a realistic savings goal with whatever you can afford per week or per month, but make sure you can stick to it.
- Use a high-interest savings account
Put the money you’ve saved into a high-interest savings or investment account, separate from your everyday account, to make your money work harder for you.
- Set a spending limit
Can’t break the habit of tapping your debit card for every little purchase? Try setting up a separate spending account linked to your card. Limit the amount you transfer into this account to help manage your weekly spending and use it for eating out, entertainment and non-essential shopping.
Ultimately, a good budget is one you can stick to and easily update when your savings goals change.
Gimmie enables you to better manage your budget by giving you the freedom to pay over one or two years – in weekly, fortnightly or monthly instalments that suit your lifestyle.
For more financial education tips, head to On the Money with Mark Bouris
