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Budget Tune-up for the New Year

Budget Tune-up for the New Year

I know, budget is a dirty word to lots of people. But even a basic one can help you control your money instead of having it control you. This week is a quick post about the budget you already have and how to give it a tune-up to work better for you. I’ll cover how to budget from scratch another time.

Compare Your Numbers

Grab your old budget and look at how your actual expenses compare to what you planned. You will probably see some area where you consistently either ran over or under. Neither is necessarily a bad thing, but it might mean you need to cut back on something. But if the spending is consistent, just make an adjustment to your new budget and move on.

Add Categories

Now that you are looking at it, do you have things categorized completely? For instance, you might want to separate lunches at work out from your restaurant category. If you always eat lunch out, then budget a set amount for it and then your social restaurant meals can be tracked more easily. Use the same idea for clothing purchases, track work clothes separately. Both can come in handy down the line if you are trying to decide how much it costs you to work. There are several categories that this applies to, transportation and childcare are often work-related.

Pay Yourself First

This is the most important tip. You should be saving money for your future in some way. Set up a savings account and have your direct deposit split so you never see the money in your regular account. Or have a Roth IRA at your bank and have an automatic deduction on payday. Treat savings like a bill and it will grow and help make your future more secure.

Look at Fixed Expenses

Now is the time to pull out your recurring bills like cable, internet, cell phones and satellite radio. Have they gone up in price and you haven’t noticed? Or have they stayed the same and maybe you are getting less for your money now? This is where we can help, BillCutterz can analyze your bills and let you know how we can cut them down for you.

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