Have you heard the old saying, “You don’t know where you’re going unless you know where you’ve been”? If so, then maybe you’ll relate to the picture we think of when we talk about creating a monthly budget. After all, if you don’t know where you’re already spending your money, you don’t really know how you can prepare to save money in the future. Here are a few tips and tricks to help you along the way:
• Don’t Be Afraid of Your Numbers. Sure, debt can be scary. And even scarier can be the math that results from adding up all of your debt and trying to figure out how to pay it. Don’t be afraid! The sooner you’re willing to own up to your numbers, the sooner you can put a plan into place to help you better manage the bills that are coming into your household. When you start creating a monthly budget, use a simple pen and paper to write down what you think you’re spending. This will give you a great outline to build from.
• Utilize Online Banking. Even if you’re not comfortable paying your bills through online bill pay, online banking can be a great resource to help you reconcile your expenditures. Go online daily to see what’s cleared and what’s pending. Keep in mind that any checks that you’ve written, gratuities at restaurants, and payments at gas pumps are not always going to be accurately reflected in this total. You should use this solely for reconciliation purposes.
• Embrace Spreadsheets. Spreadsheets can sound scary, but they’re super useful, and they’re not nearly as hard to figure out as you may think. If you have a Google (or Gmail) account, you can utilize Google Drive free of charge (and if you don’t have one of these accounts, you can set one up for free instantly). The spreadsheet goes with you wherever you are, and you can access it from anywhere that you have the internet. Your spreadsheet doesn’t have to be complicated; just create columns that show the date, description, debit (-) or credit (+) and balance to your account. Microsoft and Apple have similar spreadsheet capabilities that allow you to take your budget with you wherever you go.
• There’s an App for That. These days, technology can work to your advantage if you identify what you need to make your life better. When you’re creating a monthly budget, apps can be an amazing tool to help you achieve your monetary goals. Some really great apps cost money, but there are tons of other apps that can help you understand where your money is going without spending more money on the technology itself. Mint is a free app that categorizes expenditures so you know where you’re spending money and helps you understand where you can cut back.
• Pull out the Big Guns. Pie charts and graphs may seem unnecessary at first thought, but in reality, pictures really do equal a thousand words. Programs like those made by Quicken can help you picture where you’re spending your money. Quicken is notably a resource that helps accounting from all levels, from individuals to corporations, so if you’re working on creating a monthly budget for your household, keep in mind that this resource will let you see your goals, your expenditures, and your savings so you can work to bridge the differences.
Are you interested in getting help with creating a monthly budget for your household? You’re always welcome to contact a member of our team at Northcash. We’d be happy to tell you how we may be able to help!