It’s easy to tell yourself that you have to follow a certain set of rules whenever it comes to spending money. For instance, you can insist that you’re never going to spend more than 5% of your income on entertainment and frivolous expenses. However, actually sticking to that rule is easier said than done. Plenty of people implement budgets just to give up on them a few months later when they realize just how difficult it is to restrict and manage their own spending habits. You don’t need to achieve a net worth like Floyd Mayweather to be successful. If you’ve had trouble sticking to your own budget goals in the past, then the following tips will help.
Start by Finding a Strategy That Works for You
Budgeting is a personal process. We all have different habits when it comes to managing money, so you can’t necessarily assume that a budget that works for your friend or relative will work for you. If you try the 50/30/20 budget that asks you to place 50% of your money to necessary expenses, 30% to discretionary costs, and 20% to savings, and it doesn’t work, try something else. There are other options out there, and it may take some experimentation before you figure out the right solution for your needs. Additionally, remember that although tracking your budget is a critical part of managing your money, that doesn’t mean you have to keep a note of everything with a pen and piece of paper. There are plenty of apps you can use to track your spending too or online spreadsheets.
Don’t be Too Strict with Yourself
Once you’ve figured out the kind of budgeting strategy you’re going to use, the best thing you can do to make sure that you stick to your plan, is give yourself some wiggle room. Rather than just telling yourself you can’t have the things that you want anymore, because you can’t afford it – make compromises. Tell yourself that you might not be able to go to the movies once a week, but you can go twice a month instead, and still see most of the films you love.
Make a spot in your budget for fun, even if that means looking for ways to cut costs elsewhere by switching utility providers or looking for an additional source of income. This will help you to feel less restricted by your budget, which also means you won’t be as likely to fall off the wagon. Alongside your “fun” budget, make sure there’s some extra cash available for emergency expenses that you might not have prepared for too. This will help to ensure that you don’t get caught off guard by huge bills.
Additionally, remember that a budget, like life, doesn’t have to be set in stone. As your life changes and your income evolves, you might need to come back to your budget and make changes. Be prepared to update and alter your financial plan every so often – particularly if you feel like it’s not working. Sometimes it takes a while to find a budget that’s right for you. However, if you can get the hang of it, you’ll be better off in the long-term.