Tips for Maintaining a Successful Budget
Budget Each Month
In order to be the most efficient and responsible consumer, it is important to dedicate time at the beginning of each month to create your budget. It is extremely unlikely that your first month's budget will be perfect, but do not feel discouraged. At the end of the month, look over your budget, and decide where errors were made and correct those for next month.
Stick to Your Budget
One of the most important aspects of budgeting is being able to stay on track with your budget. If you budgeted one night a week to eat out, then do not be tempted to go out with your friends if you have already spent that money. One of the best ways to keep track of this is to get out the money you plan on spending and put it in envelopes labeled with specific categories. Once the envelope is out, then you do not spend any more money in that area.
Know Your Income
One individual's income is highly unlikely to be the exact same as another individual's. It is important to know where all your sources of income come from. Is your income irregular or does it generally stay the same? Is there any reason that your income might change suddenly? These are important questions to ask yourself when creating your budget.
Essential vs. Nonessential Expenses
That cup of coffee that you get every day can be nice, but so is being able to eat lunch. The essential expenses like food and shelter are the ones that you absolutely need to live. Designer clothes and coffee are examples of nonessential items. This list of items can be great to go back to if you need to figure out where to cut costs.
Fixed vs. Variable Expenses
Phone bills and rent can generally be considered fixed expenses. This is because the amount you pay does not change from month to month. Items like clothing and gas vary depending on the month. If it is a month you know you are going to drive home more, then be sure to budget accordingly for that.
Income - Expenses = Zero
When creating your budget, make sure that your expenses do not exceed your income. If it does, figure out where you can make some cuts in your expenses or increases in your income. A budget is possible with any income, you just have to be willing to make the necessary changes in your lifestyle.
Emergencies are going to happen when you are least expecting them. The best thing that you can do is be prepared for when they do happen. Start putting a set amount and any extra money you have at the end of the month into a savings account. This account is meant to be used for emergencies only! This can relieve the immediate stress that comes from unexpected events like flat tires or a sudden job loss.
Learning to Say No
One of the hardest things to learn when budgeting is being able to tell ourselves and others no. We live in a world where debt is a fairly normal concept and is almost expected of us. Don't be afraid to tell your family, friends and even yourself no when it comes to spending money you don't have. You may find it frustrating at first, but you'll thank yourself later when you can pay the bills and have a little money left over.