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Saturday, July 28, 2012

How To Stay On Budget!

Creating a household budget can be a real challenge. Staying on budget can be even more daunting.

It's very important to stick to your budget once it is created.
Having a budget can help you save for things like a car, new furniture, college or just help pay the monthly bills.
An important part of any budget is how much you can save. Have that amount deposited directly into your savings account and do not mix it with money needed to pay bills.
Using cash to pay for items when shopping will help you realize just how much you are spending as well as limit the amount you spend. It's too easy to put purchases on debit and credit cards. Paying with cash keeps things real!
Keeping cash in an envelope can help you realize how much you have left for the week or month. When the envelope is empty, you cannot buy anything else! You will likely tighten your belt when you see there is not much money in the enevelope to get you through the remainder of the week or month.
Be sure to plan for fun. You are much more likely to get off budget if you do not plan for money to go to the movies or eat out once in awhile. Not allowing for family fun will keep everyone frustrated and you may give up and just start spending uncontrolled again. 
When an unexpected expense occurs, will you give up movie night or throw the cost on a credit card? Have a game plan ahead of time to stay on track.
Creating a new budget is the perfcet time to quit bad habits such as smoking or drinking alcohol which are expensive.
You alone cannot be the only person in your household responsible for staying on budget. Get others onboard early in the process.
Know where your money is going by keeping receipts and discussing them once or twice a month with other household members. You will likely be surprised just how much was spent on certain items. Look for ways to reduce those costs. Reducing cost may not mean doing without. There could be less expensive alternatives.
Keeping your checkbook balanced is essential to staying on budget. 
Write out your grocery list and know exactly which items you are going to purchase before you go shopping. Avoid impulse buys at the grocery store! Temptation is everywhere.
Keeping some savings immediately available for emergencies and other money invested for long term is the best plan. You are less likely to access money where there are penalties for early withdrawl.
Make financial budgeting a lifestyle instead of a short term idea to get out of a jam.
Focus on a goal and visualize it. If you are saving for a car, see youself buying it when you spend money. Realize every dollar you save gets you closer to making your goal a reality.
Look out for hidden costs such as leaving lights and tv turned on when not being used by someone. Children are known for leaving doors open leading oustide. Are you trying to air condition your apartment patio?
Money and finances is a major cause of arguments and divorce. Get buy-in from everyone in the home. Everyone should understand and agree on the purpose of the budget as well as reasonable money set aside for fun activities. There will be less arguments if all household members agreed when the budget was created.

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