The Art of Budgeting and Spending Your Money Effectively

Written by: April Lunar


Creating and handling a budget is a key part of handling your finances over the course of any period. Here are some tips that you can use in order to make sure that you’re staying within your budget, but also maximizing what use you get out of your budget over the time that you are measuring whether it’s a day, a week, a year or anything else. 

Budget at the Start

You’ll want to make sure that you create or at least update your budget at the beginning of every month or another period. Generally speaking, however, you need to go monthly. This isn’t absolutely set in stone, but it’s usually the agreed-upon standard. If you don’t do it monthly, then the other units of time may be too unmanageable. By doing the budget at the beginning of every month, you will ensure that you have everything you need ahead of time, this way you won’t end up with any surprises during the month. This will be a great advantage to you going forward since you’ll have peace of mind, and you won’t spend the night every night wondering where all of the money for certain expenses is going to be coming from. 

Be Realistic

It’s important to not pretend that money is going to be coming in when it’s not. It’s also important to not pretend that you have a cheaper version of something than you have. In general, try to deal with reality on its own terms whenever and wherever you can. You’re going to end up with nasty surprises if you do too much wishing instead of looking at the cold, hard facts behind each purchase and each bit of income that you have over the course of a month. 

Adjust Based on What Happens

It’s also important to not try to keep your budget set in stone at all times. It’s going to be a living thing, constantly changing with what happens. If you end up losing a source of income, then you will have to change in order to accommodate that difference. You will have to find places where you can spend less money, for example. Or, perhaps you will instead end up with a bill that you weren’t expecting. In this case, you will also have to find the money to pay for it in a place that you usually spend on something else as well. 

Make Sure You Have a Backup Category

Sometimes people also call this “Misc” in order to describe purchases that don’t fit into any other category. This is important to have in any budget in order to make sure that nothing falls between the cracks. Surprises are going to happen sometime, so the key is to make sure that you are ready for them. It’s also important to make sure that you don’t worry about exactly where something should go. If you can’t find a category in any other place for a particular expenditure, then you will end up just putting it into misc. That way you reduce worry and wasting time trying to categorize everything.

Kill Debt When You Can

Getting rid of any debt you have is something you definitely need to prioritize. It’s going to cost you extra money each month that you carry it, so it’s important to make sure that you get rid of it whenever you can in order to minimize that expenditure from your life quickly and efficiently. 

Stick to a Routine

It can help to stick to a particular routine going on a month to month basis so you don’t forget to do it, and also so you don’t try putting it off and off until the last second. As a result, if you pick a date to do it at the beginning of the month, this can definitely be a major help in making you feel like you’re in control of it all. 

Pay Attention to What Actually Happens

It’s not enough to just make a plan, you need to try to follow it. Plus, if you can’t follow it for whatever reason, then it’s important to react to this. You need to write down each expense and see how it matches up with your budget for the month. If it doesn’t match up for some reason, then you need to figure out why this is the case, as well as what you can do about it. Search through your finances and find out what went wrong. This is a key part of budgeting.

Try Cash If You’re Struggling

If you’re having trouble staying within your budget, then one little trick you can try in order to make sure this becomes less of a problem moving forward is to just use cash for the expense. If you pay only in cash, then you won’t be tempted to overspend at all. 

Add Extra

There’s always going to be extra fees that you weren’t counting on during the month. Therefore, you should add a bit more into the budget then it calls for in order to counter this problem. If you add this under “misc,” or perhaps its own category, this will certainly help you feel better about knowing that you’re covered in case of any catastrophes.

Other Considerations

One thing that often trips people up when it comes to their budget, is getting obsessed with what other people are spending. You need to avoid doing this if you can. It’s just going to make you jealous and tempted to spend more money than you should just to ‘keep up’ with other people. However, you aren’t other people, you are you. If you focus on just yourself, your budget will work out much better than if you don’t It may take some time to get everything right, but it will be worth it.


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