HOW TO ESTABLISH BUDGET GOALS WHEN CREATING A BUDGETNovember 2, 2022 / by Marco / Categories : Business
Do you feel as if you are constantly updating your planner, trying to organize your finances, and save money? Well you are in luck, because that’s what we are providing, we want to help you establish a budget plan to achieve your financial goals! This is why you NEED to establish a goal-oriented budget.
Perhaps you feel that no matter how hard you try to stay organized, you seem to be stuck in the same position. Fair Credit is ready to help you knock down those hurdles and clear your credit report today!
Follow These Easy Steps To Create Your Customized Budget.
- Goals: Write down your short-term and long-term financial goals. Committing them to memory through writing will automatically make you think about them when you want to spend unnecessarily.
- Specify: Do not write vague statements. You must be specific when planning.
Use headings to highlight the focal points, for example, Debt repayments, credit score building, less spending, investing in better qualified, longer-lasting products.
- Deadlines: Give yourself reasonable deadlines. Spend your time wisely! Prioritize time-sensitive goals, and divide your long term-goals into little goals which will keep you motivated, and less stressed about achieving such a monumental goal.
- Write down: Keep a binder, budget planner, or use an app to illustrate and organize your budget. Split your budget into “income” and “expenses”. Under “expenses”, list all your monthly expenses all the way from legally required (e.g., Tax), to spoils (e.g., spending at expensive restaurants).
- Allocate: Decide how much you need to allocate to each category, and stick to that amount as tightly as possible! Even if that means cutting down on luxuries like going out for entertainment purposes, or buying yourself expensive gifts.
- Save: When you get paid, transfer your desired savings amount into a savings account. Have a savings account that is only accessible after at least a few months of maturity to ensure that you cannot touch that money.
- Debt: Pay off any debt owing, before getting yourself further into debt. Having a good credit report is key to accessing loans, paying lower interest rates, and renting property. Once the debt is paid off, you can stop stressing about it, and move on to a more positive financial future.
Why Establish Budget Goals Matters
If you are more specific with your goals, then you are already on the way to achieving them, because you know what you need to do!
It can become tiring and difficult to manage your finances when you have so many other responsibilities in life. Having a job, supporting yourself and any dependants, as well as looking after your own health is already time consuming! That is why you MUST plan accordingly when it comes to your monthly expenses.
Things can easily turn sour when you are under pressure, and have spent without thinking carefully. You need to have emergency savings in case of unforeseen expenses, and save money to work towards your financial goals, all whilst dealing with the taxes, fees, and everything in between.
Let’s look At An Example To Put Things Into Perspective.
Every day you go to a coffee shop next to your workplace for a coffee and a snack, that’s $8.00. The office has free coffee, and your coffee at home costs less than $1.00 per cup. You can make your own muffins for half the price of the ones at the café! Add it together – you spend $240.00/pm when you could be spending less than $100.00/pm.
If you are earning $5000.00/pm, you are spending 4.8% of your monthly salary on your “least important” category.
Establishing your financial goals, and creating a personal budget is something that you will need to do at every stage of your life. Start planning earlier, so that you can save for the future.
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