With the 2018 -19 Australian Government budget recently being released I thought it was only fitting to write a blog post around the topic budgeting! Low and middle-income earners have emerged as the biggest winners from this governments planned tax cuts, with a dual income family potentially saving $1,000 on their tax bill.
Now while this probably won’t make any crazy difference to your saving goals I have formulated five top tips that will help you stick to your budget!
Saying that you will stick to a budget and actually doing it are two completely different things. While it’s a lot easier said then done, sticking to a budget is an enormously rewarding and satisfying task to achieve.
No matter how big or small your financial dreams are a budget is a vital step in getting there.
Firstly, what is a budget? A budget is an estimation of revenue and expenses over a specified future period of time; it is compiled and re-evaluated on a periodic basis. Budgets can be made for a person, a family, a group of people, a business, a government, a country, a multinational organisation or just about anything else that makes and spends money.
Having a budget allows you to create a plan that reflects your goals, priorities and financial dreams.
When talking about budgeting most people think of completely cutting out the indulgences we love, like those morning coffees or massages, but in fact it’s the complete opposite. As long as you do budget for these little indulgences that we love, then go for gold! If you can comfortably budget them into your life then there’s no reason not to have them!
As mentioned before formulating a budget plan is the easy part, not straying away from that plan is the hard part!
Here are five tips sticking to your budget tips that will help you stay right on track!
1. Write it down and keep track of your expenses
Writing down on a piece of paper, your smart phone or computer exactly what your budget is will set clear boundaries of how much you can spend. Simple!
Recording what exactly your spending your money on will help you identify the things you seem to be spending too much on, where your money is going and where it could be better spent. Keeping receipts, recording when you pay a bill or even taking photos of invoices are great ways to keep an eye on your expenses.
2. Be accountable
Having somebody in your life that can keep you accountable for your budget is a great way not to fall off track. Whether that’s a friend, a partner or even a parent, having someone to check in with each week to see how your budget and spending is going will not only motivate you but also keep you on the right track.
3. A spend less then nothing day
Sometimes we don’t realise just how easily a quick duck to the shops to grab something for dinner or buying lunch everyday can add up! Designating a “spend less then nothing day” means that you set aside day that you don’t spend anything, that is not completely necessary for your survival of course.
Be creative in the kitchen; use what you have left over. Have a coffee at home or ride your bike to work. These little changes can make a big impact overall to your spending!
4. Treat yourself
As mentioned before, budgeting doesn’t mean that you have to give up your morning coffee or massage. In fact, if we don’t do these little things to treat ourselves the likelihood of slipping off the bandwagon completely is so much higher.
Budget in something for yourself that you love and will make you feel good and recharged!
5. Be realistic
Making sure your budget is attainable and achievable is key! There’s no point budgeting so intensely that there’s no way you won’t fail. Don’t make yourself suffer or live uncomfortably just because you’re on a budget. This will end in failure… Sure, cut back or reduce reasonably but don’t take away everything, especially the things you love.
These are just five simple tips that can make budgeting more attainable and stress free! Remember, budgeting is a good thing! Don’t turn it into a horrible thing to do. Be realistic, treat yourself and enjoy the rewards that you will receive!
Michele Purvis is an advisor with over 30 years experience working in the accounting and financial services industry helping clients to define and create their wealth.