Budgeting is the heart and soul of your financial health and future. Here are eight expert tips gleaned from the masters of money across the globe to help you achieve your goals!
1. Track Every Expense — Every Single One
Pro budgeters don’t let anything slip through the cracks. They know the moment they miss something they’ve purchased, no matter how minor, they lose the plot with their budget. Keep track of your expenses by hanging on to receipts of budgeting on the go with an app.
2. Audit Your Budget Often
Too many people trust their first instincts with their budgets. And while it might get you by initially, there’s always room for optimization. Financial gurus agree that going through your budget frequently to see where you can move things around is crucial for financial growth and holding yourself accountable when you go off track.
3. Treat Your Savings Like Your Mortgage
If you want to get somewhere with your savings goals, consider it a non-negotiable expense. Paying yourself first is a common ideology amongst budgeters, and it’s one of the best ways to ensure you’re always meeting your monthly savings quota.
4. Automate Whenever Possible
Automated withdrawals from checking to savings and automatic bill pay are instrumental for the savvy budgeter. They free up space in your head so you don’t have to remember everything while also ensuring you never miss a payment. They’ll also keep you honest about your savings plan since you’ll have to have the money in your account to cover the withdrawal.
5. Don’t Forget Your Safety Net
The financial safety net or emergency fund should be another on your list of non-negotiables. Experts suggest your emergency savings have at least three months’ worth of expenses. In fact, many would argue that building this takes priority over any other type of savings, and considering how quickly life can change, we’re inclined to agree!
6. Avoid Lifestyle Inflation
Once you start budgeting, you might realize you have much more money to “play” with. This can often lead to lifestyle inflation, which also happens when you start making more money. Lifestyle inflation is the idea that your base cost for your quality of life increases with your expendable income. An easy way to avoid this is to boost savings and investments instead of spending them on things you don’t need.
7. Seek Out Professionals
If you’re struggling with your finances, don’t hesitate to ask for help. Professional advice can be a game-changer, often providing personalized solutions that embolden you to discover your financial goals and commit to them in a tangible way. Contacting someone for financial advice is often a good idea; however, take any advice you get from family or friends with a grain of salt, as their biases and lack of understanding of your personal situation might cause them to lead you astray.
8. Remember Patience and Discipline
Budgeting doesn’t solve all your problems overnight; money moguls know that the key to success is staying patient and consistent. As long as you show up every day with your financial goals in mind, you can do your best to honor them and build a better future for yourself.
