- Establish an Emergency Fund for, well, emergencies.
Sometimes you have a flat tire. A broken heater. Get in the habit of putting some money aside each pay period into a totally separate account. We recommend not having it tied in with your regular spend accounts at all.
As you improve your budgeting process, your goal should be to have 3-6 months of living expenses set aside. These funds could allow you to survive in the event of a job loss or unexpected life event.
- Break Down Your Spending.
This might be tough at first, but it will be worth it. Break your spending into categories (be specific!) and determine how much you spend in each category. If you don’t know, make your best estimate. As you start to track your expenses, you can adjust your budget up or down if need be. Trust us when we says this will be the step that will make the most impact on your budgeting. Being able to see where your money goes versus where you want it to go helps you set realistic goals. We recommend an app like Mint (mint.com) to assist with this, and the app can help you keep track on the go.
- Try to Plan for Unexpected (FUN!).
The unexpected doesn’t always have to be something negative. It can be an invitation to join friends for a night out, or an opportunity to take the kids somewhere fun for a day. Be sure to leave “wiggle room” in your budget for things of this nature.
For some families, it helps to have a separate “Fun Fund” that houses money just for having fun. It can be used for dinners out, a trip to the zoo, an afternoon at the movies or saving up for a big family trip.
We find that more people can stick to their budgets when they don’t feel like that have to stop “living” in order to save money. Budgeting is all about working smarter, not harder.
- Set Short-Term and Long-Term Goals.
Your short-term goal may be to pay off a credit card (or, this might be a long-term goal). Your long-term goal maybe to go on a European vacation. Whatever your goal, set a date to achieve it and determine which steps you need to take NOW to get there.
This may mean shifting money from other categories of your budget, but that is all part of the process.
For more budgeting assistance, call us at 919.734.8224 and ask to speak with a Member Services Specialist or email us at firstname.lastname@example.org.