3 Budgeting Tips That Work – How To Budget Like A Pro

You can do a lot more with your finances if you learn how to properly budget and save. You could go from sitting at the house watching television during your paid time off of work to taking a nice vacation with the spouse. You can do much more with your life if you learn how to handle your money like a pro. I’m going to give you 3 tips that if done correctly and steadily will be very effective. Some of these tips may seem obvious; however, too many people fail to do them!

1. Learn To Budget – As painful as it may be this all comes down to the old fashion way of grabbing a pen and a piece of paper and doing some math. Figure out your average monthly income and write that number down. Then, subtract all your bills. After that, take 5% or 10% of the remainder and add it into your savings account. Finally, you have to reward yourself. So hopefully you have something like $300 left, so take $100 and use that for recreation and put the remaining $200 into your budgeting or reserve account. Be sure to realize that life and finances is subject to change. So make this a reoccurring thing. I create a new “Budget List” about once every 3 months.

2. Expect The Unexpected – Things happen. Whether we like it or not, that’s just reality. You have to have the willpower to set aside some amount of money each paycheck into your reserve account. You still should also set aside a certain portion and put it into your savings account but if you put all your budgeting money and saving money into one place you won’t be building as much interest as you should be once a tire goes flat or you need an oil change or whatever else. Budgeting and saving are closely related but they are not the same thing! You do not want to have to spend the money you have been saving. The purpose of the money you have been budgeting is meant to be spent when needed.

3. Become Debt-Free! – This tip is very rewarding and so underestimated! Pay down your debt! I understand that by making investments you can one day become rich. But is becoming debt free not an investment? It’s an investment in yourself and future! Once you become debt-free investing will be much easier as well. So don’t feel like it’s an awful idea to pay a little extra every month. Of course, residual bills are inescapable but temporary bills are not such as a credit card or car payment.

There’s a ton of other tips on things you could be doing to budget better. These three are just ones that I have found to be effective in my own personal life. If you do happen to follow these tips you will see the results! If you follow these tips for two days and then stop, you probably will not see results. It is your decision to budget like a pro, become debt-free, and to be expecting things to happen. It’s also your decision to make the most out of your income and achieve financial freedom.

How To Stretch Your Salary When You’re Stuck

Sometimes your salary isn’t paying quite enough to cover all you wish it could. Maybe you got promoted to an exempt position that looks good on your resume, but now that lucrative overtime bonus is gone. You could have been offered benefits that you truly need (medical insurance, for instance), and on paper it all looks good, but in your wallet there’s not enough cash.

This is where that “B” word – Budget – comes in to help.

All the experts start with an honest assessment of where your money is currently going. If you don’t know where your money is currently going, how can you control its flow? Write down all the ugly reality on paper so you can look it in the face and deal with it.

The problem isn’t automatically solved by a higher salary; it is solved by controlling the way you spend what you earn.

You can see this in the sad tale of many lottery winners whose huge chunks of money are gone in a few years or the way even high earners go bankrupt. This means that you have hope because you can control your cash flow by choosing to work with the real numbers instead of the dream numbers.

Look at the real numbers and come up with a real plan and follow it:

  • Do some research on money management. There is so much wisdom and free advice or seminars out there that your head will spin, but the reality is you have to make it work for your situation.
  • What are you willing to sacrifice to keep that steady salary or those benefits?
  • When you make the choice NOT to spend, remind yourself that you are saying “no” to this thing and “yes” to controlling your cash flow. You are the boss of your spending.
  • Pay the minimum on your bills if you have to, but add a little when you can. Somehow, that extra gives you a sense of power.
  • Allow yourself some “mad money” that you can spend on whatever you like, but when it’s gone, it’s gone until you get paid again.
  • Somehow, keep saving for emergencies. Even a little bit adds up!
  • Sell some stuff and put the money on the biggest bills.
  • Come up with ways to reward yourself that don’t cost money.

Keep a reminder of your plan, and your goals, in view. You aren’t “stuck” with that salary, you have chosen to stay in the position for a reason. Is your reason still valid? Can you ask for a review and a raise? Are you utilizing all the benefits you have? You may need to sit down and crunch numbers with others who are involved with your money decisions, but it will be worth the time and effort that takes to get everyone on the same team in this!