5 Simple Budgeting Tips

No matter how big your income is, budgeting is the key to a stable financial situation. Why income doesn't matter you may ask? Well, if you cannot budget when you have $1,000 how will you budget when you have $10,000? Budgeting is a habit, or rather a lifestyle that you have to get used to and keep applying. Below are five simple budgeting tips to get you started!   Make a full review of your income and costs Take a while to consider all the bills and monthly outflows that you have to cover. Put them in a clear list, so you see the total outflow. Do the same with your income. If you have one job, that is quite easy. If you are working several part times jobs - put the number together. Particularly, in the case of costs this a crucial point. You have to get things under control, and the only way to get them under control is to have a clear view on what your costs really are.   Needs and wants You have to strictly differentiate between what you really need and what you just want. Needs are the things that you really need in life. You need to pay bills, you need to buy groceries and so on. Wants are not necessities. Those are the things that you can go without, but in this moment you feel like you need them. In most cases, you do not. If there is a bigger “want” that you are going for, give it a few days. In most cases, your desire to get the item will pass.   Push your costs down Seems obvious right. You would be surprised. How long has it been since you revised your mobile plan? What about cable TV? Maybe you could switch to Netflix, it’s cheaper. If you will go into details, there are many areas of your spending where you can push the costs down. Do it and keep it that way. Pushing down the costs is much easier than making more money. Do it every quarter. You have to constantly keep revising it, or else it will grow over you again.   Be consistent It is not enough just to sit down one evening, make some financial planning and then forget about it. You have to stick to it. Consistency is the key here. Check your budget every week, see if your spending is in compliance with the budget. The fact that there is a number written down and you have a plan will help you immensely when taking control over your spending.   Make projections and save historical results Save your spending history. Monitor your monthly balance and write it down in a spreadsheet. Time flies by very quickly and just by looking back you will know if you did well this quarter or not. You cannot improve what you do not measure. If you will monitor your balance and spending month to [...]