Learning how to budget your finances is the first step to being able to get a clear and accurate picture of where your money is going. By knowing what your money is being spent on, it’s also easier to find ways to save and to pay down debt. Vogue Financial Solutions can help you learn how to budget your finances so that you can achieve your individual financial goals.
Why is Budgeting Money Important?
Did you know that many people are unaware of what they’re spending their money on every month? It’s not surprising due to hectic work schedules, increasing family demands and other obligations that individuals must deal with on a daily basis. Even so, not making the time to create and stick to a budget can be detrimental to a person’s finances.
Budgeting money is important because it truly gives you an accurate assessment of how much money is being made compared to how much money is being spent. Without this assessment, it’s very easy to overspend, which can result in increased debt and bills not being paid on time.
The first step of budgeting your finances includes keeping track of all income and expenses. Once this process has been completed for a given period of time, you will then be able to see different ways that you can reduce spending, increase savings and pay down any debt owed.
Why Most Budgets Fail
Even when a person decides to create a budget, it’s common to let it slide after a short period of time, resulting in the budget not being maintained and not being stuck to. But why do most budgets fail?
A budget is an essential financial tool, but most of them simply fail due to an individual not making enough time to maintain it. Budgeting is often looked at as a daunting task that takes a lot of time and energy. When people set up a budget, the intent is to put the effort required into it, but it’s too easy for life and other priorities to get in the way. At Vogue Financial Solutions, we will work with you on your financial goals to create a plan that’s easy to maintain and stick to.
10 Tips to Get You Started with Learning How to Budget Your Finances
To help you get started on your quest in creating and maintaining a solid financial budget, we’ve created a list of 10 tips that you can start using right away.
- The first tip is to keep all receipts so that you can keep track of where your money is going. If you try to guess on what you spent money on for the day, week or month, you’re not going to end up with an accurate financial picture.
- Next, make sure that you document all of your debts and how much you owe on them each month. Also keep track of how often each payment is due and the exact date that it’s due.
- The third tip is to make a list of any and all income that you regularly receive.
- Now that you have the 3 key pieces of information above, put the information into a simple spreadsheet and make 3 columns titled “Income,” “Debt” and “Purchases.”
- As you keep track of your income and spending, you’re going to start to see a clear financial picture. However, it’s also important to make sure that don’t skip out on entering purchases and that you stick with tracking this information for a few months so you can see what your spending habits are.
- The sixth tip involves making time to make and track your budget. If you find that you’re short on time, try entering the information daily rather than waiting to the end of the week to do so. However, if you find that you don’t have time on a daily basis, but there’s a day near the end of the month where you can enter all of the information at once, it’s better than not entering it at all. Just make sure that you kept all receipts and you have a record of your income and debts that you paid out for that month.
- Tip 7 involves making a goal that will help you stick to tracking your income and expenses, whilst also sticking to your budget. When you have a goal that you want to achieve, it’s often easier to stay on track. For example, if you want to save a deposit to buy a home, it will give you more motivation to stick to your budget. Even if you don’t have a major financial goal in mind, there are plenty of motivators that you could use, such as becoming or keeping yourself debt free or just having a rainy day fund that you can spend on something you’ve been wanting.
- Tip 8 involves getting organized. Organize all of your documents and keep them in one place so that you don’t have to waste time trying to locate the information that you need. The less time you have to spend on finding information, the better chance you will have at being able to find time to enter the data into your budget.
- The 9th tip to help you with your budget involves learning how to use budgeting software. Many software programs will automatically perform the calculations that you need so that you can save time and energy.
- And last, always be willing to reach out for help and assistance if you’re having trouble creating or maintaining your budget. Getting your budget set up properly will not only save you time, but it can also assure that you’re accurately calculating your income and expenses.
At Vogue Financial Solutions, our customer’s financial success is our number one priority. Our financial problem solving tools and solutions are meant to educate our customers and provide them with the information needed so that the best financial decisions can be made. Whether you need assistance with obtaining a mortgage or you’re looking for ways to better manage your finances, Vogue Financial Solutions can help.