Budgeting in 2018
Because money plays an important role in our lives, how we manage it determines how organized our lives will turn out. Planning your finances will go a long way to determine how organized your spending will look like. Budget helps you to prioritize the items that matter and eliminate irrelevancies.
2018 Budgeting Techniques
If 2017 wasn’t a financially successful year for you, you might want to review your spendings and check your outgoings. The importance of budgeting can’t be over-emphasized. Only 47% of people in Canada use a
- Review your budgets from previous years: Review your budgets from the previous years, especially the most recent one-2017. If you are aware of what you have been spending money on, you’d know what to place your focus. Critically revise your credit card, bank account, and current out unnecessary spendings and outgoings in your financial life.
- List out all your expenses: Get a spreadsheet or an online budget application, where you list out all your expenses. Remember to write down as many as possible, even the ones that are occasional and extras, like birthdays, vacations, wedding anniversaries, etc. Having listed out all these expenses, you can now go on to draw your scale of preference. Eliminate the expenses you know you can do without and keep the ones that are of utmost importance only- the needs.
- Design a new saving structure: You can start by setting short-term goals like, getting a new car or saving for a family vacation. You can also set longterm goals like, saving for retirement or paying into children’s education Trustfundmonthly. You can also create a 50-30-20 savings pattern. The 50-30-20 rule is dividing your net income (the money remaining after your tax has been removed), your essential needs, savings, and debts want respectively.
- Automate your monthly bills and savings: Automating your monthly bills and savings will help a long way in helping you save a lot in 2018. After your tax is deducted, your net income should be for your savings and bills payment. Automating your bills and savings is a disciplinary measure that helps you save compulsorily. You can only spend what had not been budgeted, right? It’s stress-free and effective.
- Cut out unnecessary spendings: Once you have made your budget, scan through for unnecessary budgets and cut them out. This might cause a change in lifestyle, hereby inconveniencing you in some ways, but it will be worth it in the end. Some of the ways to do this are to cut down your groceries if it seems to be consuming a huge part of your income. For instance, an average Canadian spend almost 48% of their income on groceries monthly. It can even be more, depending on the area in Canada. You can also save electricity and water bills. Pack your lunches, instead of doing takeaways always.
- Pay your debts on time: Don’t get used to late payments., Be in charge of your finances and be debt free in 2018.