As a follow up to yesterday’s overwhelmingly positive post (Thank you!!), I wanted to share some general approaches that may make budgeting easier. The following work for our household and perhaps they will work for you as well:
– Always review the household budget with your partner. One person can put it together, but it is essential to be on the same page with all financial goals.
– Revisit your budget every 6 months to a year. A lot can change year-over-year and your budget should grow with you. Our budget has looked about a million different ways in the last few years because our circumstances have changed, so it was important to make amendments to account for those changes.
– Be flexible. There will be months where your actual spending will not match what you have budgeted. That is okay. It is important to maintain a levelheaded perspective and get back on track next month!
– Always have an emergency fund. I know I have preached about this in previous posts (seen here), but I cannot stress this enough. If your budget does not allow for the 3% rule of thumb, put aside what you can afford. It is better than nothing at all.
– Have realistic goals. It is fantastic to want a bigger home, new vehicles, trips, clothes, etc. The reality is that your income may not support all those things. If you want to achieve a financial goal, sacrifices need to be made. Ask yourself: Do you really need the latest phone? High end clothing? 2 brand new cars with payments? Probably not.