8 Tips For Successful Budgeting - Refresh Financial

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8 Tips For Successful Budgeting

We all know that the best way to ensure we’re living within our means and not accumulating more debt is by budgeting our money. It’s easier said than done, though, isn’t it? There’s a huge difference between writing down a few numbers and actually living by them.

So, with the understanding that sticking to a budget is difficult, we thought we would throw together some tips to increase your rate of success.

Here are 8 tips for successful budgeting:

1. Be Realistic

Prepare for your weaknesses. If you love going out for dinner on Friday nights, don’t expect yourself to cut it out completely. Instead, maybe only go out for dinner every second Friday, or use the Friday dinner as a reward for sticking to your budget. We all have little pleasures that are hard to give up and it’s not going to be any easier just because you’ve cut it out of your budget. Doing so only sets you up for failure. It’s more realistic to cut down on those guilty pleasures and but still allow yourself these simple joys, just less often.

2. Give yourself a day to think about big purchases

Before you run into Best Buy and get suckered into grabbing that new smart TV, promise yourself you will take a day to think it over. Usually, after thinking about it for a day, people realize that this huge expense is unnecessary and not worth jeopardizing their financial future.

3. Plan your menu and shopping before going to the grocery store

Make a plan for what you’re going to eat over the next week or so, and base your shopping list on this plan. Ensure your list is complete before you go to the supermarket and try to stick to your list once you’re there. This way, you will ensure you’re only buying what you need and nothing more.

4. Use an app

Mint is a great app for Canadians to track their spending. It connects to your bank accounts, your loans, and your credit cards and gives you an overall view of where your money is going every week. It enables you to budget and categorizes your spending by extracting your data from your various accounts. You’ll get alerts for upcoming bills as well as finance charges and you’ll be able to see everything in one big picture. You can grab Mint here.

5. Use automatic transfers for saving

Set up automatic transfers on payday from your checking account to your savings account. This way, you probably won’t even see it in your checking account at all, and it’s like it was never there. You’re less likely to spend it if it’s in an account apart from the one you use to make your purchases and pay your bills.

6. Tell someone about your budget

Just the act of talking about being on a budget makes you feel a little bit more accountability than you may have felt before. If you don’t stick to your budget, you’re going to feel as though you owe someone an explanation or perhaps that you’re all talk, no walk. If you have a partner or a spouse, it’s even better because you can both work hard to stick to your budget and hold each other accountable.

7. Ensure your debts are going down

As your debts get paid down, you will free up more money to apply to your budget month to month as you will be paying less in interest and your minimum payment will be smaller. Eliminating your debts altogether is an even better idea, as it will free up all the money you used to pay them down every month.

8. Look at your credit card and bank statements

Do not ignore your statements. It’s easy to just spend until your card gets declined but that’s when you get into the really hot water, incurring overdraft charges, insufficient funds penalties, and fees for going over your credit card limit. Instead, ensure you’re keeping a close eye on your statements so you know where your money stands and how much you have left at all times.

These few simple tips can increase your chances for success with your monthly budget, but we would love to know if you have anymore. What tips would you give to someone looking to be more successful in budgeting? Let us know in the comments!

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