Christmas is around the corner with Carnival on its heels, so taking charge of your money, whether you have a little or a lot, will ease money stress especially come January next year and you will feel more in control and secure. Usually, when the topic of budgeting comes up in conversation, the response generally will be yes, yes, I do that but yet there are complaints that they are shocked at the balance in their accounts come the 15th of the month. Therefore, the first step is to do a budget. Easier said than done.
It is said that a budget is like a bra. It feels weird the first couple times but once you get used to it you’re glad it’s there. A budget shows if you are spending more or less than you can afford and enables the directing of one’s money to where it matters most, thereby staying on top of bill payments, paying off credit cards, loans, saving for a holiday or big purchase and putting money towards future goals but most importantly, a pension separate and apart from your company’s pension.
The easiest way of doing a budget is in a copy book. Yes, a copy book. One side of the book is for all income while the second side for is all expenses; a pencil to make the entries and a calculator. It is easy to walk around with than a laptop and adjustments can be made right away. For those who like their technology, doing a budget in a spreadsheet is the way to go. That way inserting and deleting rows are easy and the formulae is automatically updated.
Another advantage of the copybook is that it helps with the purchasing of food and household items every month. At the back of the book, 5 pages before the end of the book, make a list of the items on the left hand side of the book and rule up columns for the 12 months. When entering items put down the quantity that you would expect to purchase. Each month, check your cupboards and for each item write down in the relevant month column how many of the items that you need to purchase to bring you back up to your regular stock. That way, you don’t have to purchase items that you may not have touched for the month.
In talking with my friends, a regular problem that they have is keeping track of bills from purchases to plug into their spreadsheet when they get home. Below are several solutions for this:
- Keep a brown envelope in your handbag specifically for bills
- Use free easy-to-use apps such as trackmyspend or receipts to enter bill information
- Send yourself a text msg indicating the item and the amount purchased. Subject line can read: “Purchases – Tues 29 Oct 2013”. Easy to locate when you are ready to enter in your spreadsheet
Utility Payments can be tedious. One way of dealing with it is to set aside in a separate bank account called “bills”, and put aside a portion of the amount, during the time period before the next bill arrives, so that when the bill becomes due, payment can be made without having to scramble to collect all the money to pay the bill when it comes.
If you are trying to save money, look at your budget and find ways to cut back on the extras. Try and budget a specific amount for fun, leisure and personal expenses but the secret is to not make your budget so tight that you won’t be able to stick to it.
Last but not least, aim to become your own banker. What I mean by this is – borrow from yourself when necessary and pay yourself the interest that the bank would charge, if you were to borrow from the bank.