Get motivated tips

Chances are you are either using some type of budget spreadsheet or a budgeting app to create your budget. You want to take a look at your budget data and study your budget trends. Maybe you were able to pay off a significant portion of your credit card debt this past year or there were household spending changes. Maybe you were able to save money on housing costs in your budget. On a spending audit, I recently had 21 unusual things I stopped buying in my household. By knowing this kind of information and addressing household spending changes, you can change your long and short term goals which in turn will impact future budgets. If you are good at excel and your budget spreadsheet is in excel, you can create custom formulas that will automatically calculate things such as percentages of increases or decreases within a budget category. Knowing this information is extremely important and worth knowing in your financial life.

Creating a budget is a lot of work and so is living by a budget. It takes a lot of personal power to hold yourself accountable to the budget that you have created. Accountability is one of the most important budgeting tips and tricks available. Luckily there are a lot of techniques and budgeting tips and tricks you can use to combat this within your daily life.

• One of the easiest ways to hold yourself accountable and make sure that you physically make and pay your bills each month would be to use automation. Almost all banks nowadays offer free bill pay. Set up monthly fixed expenses or bills in auto pay to be sure that they are paid. Use instant online check cashing for cashing checks. This way you will not even see the expense being paid.
• Another option to hold yourself accountable would be to use the envelope system. This is a budget system that includes creating an envelope for each spending category. You put money in the envelope based on what the budgeted expense amount will be for that month.  When there is no money left in the envelope after the end of the month, you are done spending.
• The third way to hold yourself accountable is to track spending. As stated above there many budgeting apps and software that will assist you to help track your spending.

When it comes to physically creating your budget, you will have to make some decisions on the type of format. Choosing the correct budget format to align with your goals is also one of the most important budgeting tips and tricks to follow. There are a lot of different types of personal budget systems so you have many options in this area.

• One option is to actually hand write out the budget, however there is a lot more time involved by going this route. While it is a good way to learn the intimate details of your financial transactions, it is also extremely time consuming. Nonetheless if you feel tempted and motivated to create your budget document old-school, this is a great option.
• The next option would be to use an excel spreadsheet. This is a very popular option especially for people who are familiar with excel and the formulas. One of the great advantages of using excel is knowing how to run the formula calculations. Once your budget is complete in this format, it is very easy to run projections, discover trends, and even chart your results.
• Finally the third option would be to use a budgeting app. There are many out there such as mint.com.  The advantage of using a budgeting app is that you can make the entries instantly on your mobile phone when you make a purchase. This will be very hard to do if you are using the method of physically writing out your budget.  Using a budgeting app is one of the easiest budgeting tips and tricks which offers great rewards. It would also be hard to do if you are using excel, although it could be done on your mobile phone with a few more steps involved. If you don’t have a checking account, you can always use starter checks when you open a bank should you decide to use physical checks as well.

Following a budget is no walk in the park. You will make mistakes and have mishaps here and there, but that is OK. Don’t let that discourage you from sticking to your budget. A good way to keep motivation high is to establish a reward system for reaching certain goals or milestones within your budget. Establishing a reward system is one of the best budgeting tips and tricks to use. The reward could be as simple as taking in a movie or as extreme as going on a vacation. I have actually followed this tip and strategy and recently went on a vacation to the Caribbean when I paid off my mortgage early. A reward system will keep your energy and enthusiasm high for meeting your goals within your budget.

This is one of the more important budgeting tips and tricks to follow. When your budget is complete, you should go through and review your expenses and look to see if they line up with your short and long-term financial goals. I talked above how analysis is one of the best budgeting tips and tricks to keep your budgeting on track. For example if one of your goals is to get out of debt or reduce credit card balances, then you want to be sure that your monthly budgetary expenses reflect that. You should have and aggressive monthly expense factored into this category if you’re trying to pay off your credit card debt.

As mentioned above there are always extra expenses that should be planned for such as the holiday spending. You can either set up a separate savings account like what was mentioned above or you can create a miscellaneous category in your budget to cover these expenses. If you decide to use the miscellaneous category, be sure to label what it covers. For example you could cover holiday spending, vacations, and other one time events that may occur within the year.

Following budgeting tips and tricks will get you a long way. However, when it comes to the holiday spending, make sure all of your year-long budgeting efforts are not blown off course due to holiday spending. The last three months of the year usually have the highest consumer credit card debt. A big reason for this is that people fail to plan within their budget to address Christmas and holiday spending increases. Just sending out Christmas cards and postage to some of your family friends and relatives could easily cost $50 or more. If you have to prepare the holiday meal, there will be extra cost for food, drinks, and other items that you would regularly not be planning for as an expense in your budget. An easy way to address these additional costs is to set aside a certain amount of savings each month such as $50. You can create a second savings account and dedicate $50 a month towards it to cover these holiday costs. By the end of the year you will have $600 making this one of the best budgeting tips and tricks to boost your budget. As your budget improves so will other things, such as your credit score. Check out my post on how to improve your credit score that includes the steps necessary to quickly improve your FICO score.

As we described above there are certain types of flexible expenses that are higher at certain times of the year. One way to address this is to use budgetary guidelines for the monthly high for the whole year as your budget expense. This is a good strategy to sort of imply forced savings for the months that you do not hit that high. For example in the summer time you will not be running your furnace so your natural gas expense would not come anywhere close to what it would be during the winter months. Another way for you to achieve your financial goals is to make seasonal adjustments in your budget. You can do this by looking at all of your flexible expenses during the four seasons.  Calculate what the average is for those times of the year and you can use that amount for is your monthly budgeted expense.

Regularly analyzing your budget is one of the best budgeting tips and tricks to follow. When you have a major change in your life such as getting married, divorced, moving out on your own, or taking a new job, you should always analyze your budget. There are all kinds of reasons to change your household budget strategy.  Any of these factors could have a major change on your income and future expenses. You want to make sure that your budget will financially address all of your needs and concerns for this major lifestyle change. You don’t want to assume that everything will be OK. Be sure to write down what the financial implications will be into an analysis with your budget so you can be prepared ahead of time.

One of the great budgeting tips and tricks when budgeting is to use realistic targets for flexible expenses. While you build your budget, you will have to take into account what target to use for flexible expenses. These would be the expenses they vary from month-to-month such as your water bill, clothing, household maintenance costs, and electricity. These amounts will change every month such as your grocery bill.  There are ways how to save money on groceries that will yield a reduction in expenses for this category. One way to address this is to use the average of three months worth of these expenses.  This strategy would work well for things such as clothing or smaller purchases such as things like Starbucks for coffee in the morning. For things such as your electric bill and your natural gas bill for your furnace, using a three-month average would not be the best way to go. This is because your electric bill will have seasonal changes so will your natural gas bill if that is what you use for your furnace. For these types of expenses, it is better to use the highest monthly expense and use that amount  for the whole year for every month. This is covered a little bit in more detail with our next tip.