Setting up a budget can be a difficult task. There is no reason to be intimidated by this process. Creating a budget is an essential first step toward taking control of your money. Many people discover that they’re spending far more than they realized, while a lucky few pat themselves on the back for saving more than they knew.
Once you make a budget, you’ll see the areas in which you can cut costs. You’ll also learn how much you can save each month toward your future goals, and you’ll understand how to divide those savings among your short-term and long-term goals. Once you have set up your budget you can easily see where your money is going and how much you have left to save and spend. Just follow these easy steps.
- BE REALISTIC
Aim for sticking to your budget most of the time, and you’re bound to reach your financial goals. Breaking your budget occasionally is OK, providing you get right back on track as soon as possible.
2. DETERMINE YOUR INCOME
Once you’ve figured out how much money you need to stay afloat financially each month, it’s time to determine your actual income. Besides your regular salary, get an accurate picture by adding in any extra funds that come your way throughout the year, such as cash gifts, sale of items online.
3. Cut Expenses
If you spend more than you earn, your discretionary costs should be the first and easiest to cut. Pack a lunch instead of eating out. Stream a movie at home instead of going to the theater.Fixed costs are harder to cut, but you can save hundreds by doing so.
4. Savings Priorities
Once your income is higher than your expenses, decide which goals are most important to you. Your savings priorities should fall into three categories:
- Short-term: a vacation, a fund for car repairs
- Mid-term: a wedding, a college fund for your kids
- Long-term: retirement
Divide your savings into different accounts dedicated to each goal, by creating different saving groups for them on SAVE.
Download SAVE app and start saving now.
#SAVETogether.
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