12 Budgeting Tips Every Budgeter Needs to Know
Whether you’re new to the world of money management or you’re a seasoned pro, you can never have too many budgeting tips in your back pocket. Following certain budgeting tips can help you reach your personal money goals faster than ever, which is why we’ve put together this list of 12 tried-and-true money tips everyone needs to know.
1. Budget before the month begins. Create your budget a few days before the start of a new month. If you wait until the month begins, you run the risk of getting caught up in other things and forgetting the budget altogether.
2. Budget to zero. Give every single dollar a name. If you make $5,000 in a month, budget the entire amount. If you don’t tell each dollar where to go, it will disappear right before your eyes and leave you wondering where it went!
3. Track every expense. Track your transactions throughout the month. After all, a budget won’t do you any good unless you update it as you spend! Sign up for EveryDollar Plus to connect your bank account and easily drag and drop your transactions into individual budget categories.
4. Make adjustments. Say a friend invites you to go see a movie, but your entertainment budget is running a little low. Instead of declining the invitation, you could move some money around. Maybe pull a few dollars from your restaurant budget instead. It’s okay to make some adjustments if it helps keep your spending on track.
5. Create a miscellaneous category. Speaking of making adjustments, having a miscellaneous category in your budget can keep surprise expenses from derailing your budget without having to shuffle money around! Now if you need to replace some lightbulbs or buy a birthday card for a coworker, you don’t need to worry about which budget category to pull from.
6. Budget for semi-annual expenses. From vet checkups to car insurance, budget for once-in-awhile expenses by saving a smaller amount for a few months before your bill is due.
7. Save for big purchases. Fun stuff like Christmas and summer vacations can blindside you if you aren’t thinking about them until a month or two before they arrive. Rather than scrambling to save at the last minute, put aside a smaller amount of money each month to stay ahead of your savings goals.
8. Budget for fun. It’s nice to have some pocket change to spend on anything you want. Budget a certain amount of fun money each month that you can spend on whatever your heart desires—guilt-free!
9. Update your budget every month. Some budget categories will stay the same month to month, while others will change—and that’s okay! Look over your budget before the new month begins and make adjustments as necessary.
10. Understand needs and wants. Maybe you want to go on vacation, but your air conditioner needs to be replaced. Understanding the difference between needs and wants will do wonders for your budget!
11. Set a realistic budget. A budget won’t do you any good unless you make it work for you. So while your aunt’s third cousin twice removed might be able to get by on $100 a month for groceries, you might need $100 a week. Be realistic when you set your numbers or you’ll find yourself overspending every month!
12. Give yourself grace. It takes about three months for your budget to “settle in.” If you need to adjust the numbers, or if life throws you a curveball, don’t be too hard on yourself. Budgeting takes practice, so don’t beat yourself up if it isn’t perfect right away.
No matter where you are in your personal finance journey, the sooner you implement these budgeting tips, the sooner you’ll reach your financial goals!
Put your new knowledge to good use with a free EveryDollar budget. It’s easy to use and only takes 10 minutes to set up!