It’s prudent for a family or an individual to plan, develop, and put in place a budget. A budget is an effective tool for staying in control of expenditures, and it’s the primary tool helps you keep on course in saving money and paying down household debt. Speaking from personal experience, I was lost before I learned how to budget: I didn’t know how much was available to spend, I lived paycheck-to-paycheck, and I struggled to get ahead.
Unfortunately, getting on a budget is a great goal but a household budget is only as good as your commitment to adhering to the financial plan you’ve put in place.
Therefore, here are a few quick tips for sticking to your budget:
1. Consider Using a Re-loadable Card
You can stick to a budget by setting how much you have to spend with a re-loadable card. For example, a walmart money card or something similar from other retailers is one way to limit any proclivity to overspend. These cards are re-loadable prepaid MasterCard or Visa cards.
I personally use a QuickTrip re-loadable gas card for our gas expenses. While it’s impossible to set a firm limit on gas expenses, a re-loadable card allows me to deposit our monthly budget and if the card happens to run out of money by the end of the month, then I reload it and know exactly how much I’ve gone over budget.
What’s significant is that there are no overdraft fees with the cards and no purchase transaction fees. Although some of these cards may have fees to start, so make sure you check all of the terms and conditions. The great part is that you can’t go overboard in your spending because the card is limited to what is loaded onto it. Furthermore, you can only reload cash assets you have available.
2. Use a Simple System
Have a good “system” in place for sticking to a budget. A cash envelope system is one such effective system. First, look at all your variable expense categories within your budget. Next, get a bunch of envelopes and label each according to these categories. Your vehicle gas budget for the month may be approximately $200; put $200 in the envelope labeled “Gas”. Do the same for the other expense envelopes such as groceries, eating out, clothes and family “fun” money.
In this way, you’ve pre-allocated money to necessary expenditures which gives you a handle on where your money is going. The money in a certain envelope is only for that specific expense. This helps you resist the desire to spend your hard-earned cash on products and services you don’t really need.
Monitor your credit card statements for any overcharge errors. Monitor your supermarket receipts before you leave the store to make sure cashier or scanning errors haven’t added to your grocery bill. Monitor your checking account to avoid overdraft charges. Monitor Utility, Internet, Telephone, and other statements you receive for over billing errors.
Monitoring and reviewing what you have spent over the last month is a great way to establish a realistic first budget and will help give you guidance on how much to allocated in cash envelopes as well.
4. Be a Team
You may be living within a family environment, with other family members all under the same roof. Work together as a team to cut expenses and live within your financial means. All members of the family must commit to reining in unnecessary spending for the betterment of the family as a whole, and in some cases you may need to coach your children on what you’re trying to accomplish. If you have a reluctant spouse, then work carefully with them to express your desires and goals, and be careful to come across as too negatively. Focus on the positives in regards to how these changes will help your spouse (eventually) do more of what they enjoy!
Sticking to a budget is sometimes easier said than done. The consumer marketplace is constantly bombarding you with messages to “buy, buy, and buy some more”. In the long run, sticking to a budget gives you the freedom to spend your money on worthwhile things you really need.