You might be surprised at the biggest secret to living on a budget is living within your means, this is the very basic understanding required when you are contemplating living on a budget.
There are different approaches you can make to your budget and as long as they work for you then you are on the right track.
- Set a realistic budget that allows for some wiggle room, you will need it to allow you the space to accommodate the odd unexpected bill or just a small splurge occasionally.
- Set realistic savings goals, having the bar too high can seem impossible to reach and this will make you give up before you reach the target.
- Prevent stress by ensuring you have money set aside for regular bills; even if they are yearly, it is possible to put money away each week or month to pay for those yearly expenses.
- Understand how your money works for you, do you give each penny their own job; you should when you are creating your budget.
- Plot your purchases; this will highlight any spending pattern for the week or month. This is one reason why you should keep your receipts, it allows for accurate plotting.
- Use cash, this can seem like an old fashion concept but if you are looking for keeping within your budget it is a great idea to use cash for your purchases, it can help to keep you within your budget.
- Working together, this might sound like common sense, but if you are trying to keep within set limits and your partner is spending money like water then you might want to discuss your spending goals together.
- Having a savings account is important it allows you to save for your future; however, if you keep dipping into the account on a regular basis then you might want to consider having your savings in an account that is more difficult to get access too.
- Check your accounts frequently to make sure nothing comes out of the account. I check my accounts on a daily basis and for me this works fine, other people like to leave more space between checking but you should not leave it more than one or two days.
- Be flexible, it is important that life happens and even the best plans for your financial future can hit a snag in the road. Whilst this isn’t the best situation it is important to learn from your mistakes and move forward.
Whilst you might think there are big secrets to living on a budget, you might be surprised that there are relatively few secrets to living on a budget. It is about living within the constraints of the money you have available that is coming into your home and not spending more money than you have available.