Think of a budget as your sword and shield that will ensure your financial success in life. With a budget in place, you do not run the risk of overspending or making impulse purchases. Of course, this only works if your budget is sound and balanced. Check it today: below are 9 features that every good budget contains.
1. Custom spending categories
Tailor your categories to your needs. Do not just adopt any budget worksheet online. Include categories that reflect your spending and make sure you are tracking them monthly, too.
2. Complete spending categories
If you are missing money when you review your budget, it only means your categories are incomplete. Add all your expenses, big and small. This gives you a clearer picture of your spending patterns.
3. Account for your income
Projecting expenses is half the story; what completes it is an accurate projection of your income. How much money do you have for the month? Remember to factor in all your expenses, including savings, insurance, taxes, debt payments, and other deductions.
4. Add irregular expenses
Do not forget about expenses that only come every quarter, six months, or annually. Your monthly budget will fall apart otherwise!
5. Pay yourself first
A budget will not be complete without savings. You must pay yourself first, and in fact, consider savings as an expense, too. Do not settle for whatever is left. Plan for your savings.
6. Track every dollar
Made a payment? Write it down. Charged to your credit card? Write it down. It sounds like a tedious job, but once you get the hang of it, tracking your spending is the simplest thing ever.
7. Write your goals
This makes them concrete. The more you see your goals, the more ideas you will have on how to reach them. Remember to set realistic goals and work on them one at a time so you are not overwhelmed or frustrated.
8. Assess regularly
How do you know your budget is working out for you? Schedule regular reviews to maintain or adjust your budget. It is a living thing – it moves with time!
9. Keep a positive mindset
Always remember that your budget allows you to take control of your finances. It is not a limiting tool but one that will set you free!