Everyone needs a good budget plan – one that tells them how to spend their money while also setting aside funds for their savings, retirement, and other obligations.
If you’ve struggled with this in the past, it may be because you have been making one of the four mistakes below. Review them now and then take action to revise your approach.
Estimating What You Spend
No amount of help with your budget is going to make a difference if you don’t get specific about what you’re spending.
Fortunately, it’s never been easier to get the exact numbers. You can go through your online bank account and figure out exactly how much you spend on various items and obligations every month and then use those numbers to create a good budget plan.
Not Planning for the Unexpected
When most people think of a good budget plan, they think of covering things like:
- Car Payment
The list goes on, but what most of them don’t contain is money for the unexpected.
To be clear, we’re not just talking about having money for your savings or a slush fund you can use on whatever you want (e.g. clothes you don’t need, a night out with friends, etc.).
We’re talking about putting aside emergency funds that will be there if something unforeseen happens.
Sticking With the Same Budget for Too Long
Although many people resist putting together a good budget plan, once you finally do, you’ll probably feel a sense of relief.
During the months that follow, you’ll probably also feel very free. You’ll no longer worry about your finances as much.
However, don’t let this make you complacent. Every few months or so, you should take the time to come up with an even better budget than before.
Keep in mind, too, that this may mean loosening the purse strings a bit. That’s fine. The goal is to create a budget that is realistic to follow.
Trying to Create a Good Budget Plan Without Help
For many people, a budget is fairly simple. You just take how much money you make every month and break down how each penny will be spent.
Unfortunately, budgets can be a bit more involved than that. A better budget is one that takes advantage of the numerous resources available to you.
This should definitely involve apps that help you save. They won’t just make it easier to stick to your budget – they can also inform your spending habits going forward.
Another form of help you should eventually consider is hiring a financial advisor. They can advise you on your budget and assist you with long-term goals like retirement, as well. Many people simply appreciate having the peace of mind that comes from working with such an experienced professional.
Whether you need help making a better budget or you’re starting from scratch, contact Mooney Lyons today and we’ll help you with this important financial tool.
The information in this material is for general information only and is not intended to provide specific advice or recommendations for any individual.