Before you even begin to make a budget, there are steps you should take to ensure success. Our team has put together a checklist of actions that will help you budget successfully.
Step one
Write down four to six things you want to accomplish in the next five to 10 years. Maybe you want to launch a business, build a house, purchase rental properties, or start a family.
Write down two to three things you want to accomplish in the next year about your finances. Perhaps you want to purchase an engagement ring for your girlfriend, start a college savings plan for your newborn, or take a well-earned vacation.
Get into the habit of writing down one thing you want to achieve regarding your finances each month. You might start saving a certain amount, not using credit cards, not eating out, or setting a budget for groceries each week.
Remember, it’s better to set achievable goals rather than set yourself up for a fall and face disappointment.
Step two
Now you need to establish a budget and the best way to do that is to use a money planner, such as the Warren Boynton My Money Manager, which is available through online banking. Here, you can set up a budget, create goals, and track your spending.
Make sure you include the goals you have made when setting up your budget.
Step three
Now it’s time to evaluate your budget. Do so every month for the first half of the year. Did you reach your goal this month? How are you progressing with this year’s budget? Do you need to tweak or rethink your long-term goals?
Things happen in life, and we have to adapt. Spend a little time assessing your new situation and moving forward with realistic goals – and a new budget.
After the first few months, you may find areas you can cut your spending back even more. Do you need to buy that latte every day? Could you make a pot of coffee at home and treat yourself on the weekends? If you’re overindulging in takeout, look at cutting back. Do you need to look at exchanging your car for a less expensive model to reduce your car payment? Can you switch your utilities to reduce costs? Are there ways to make passive income? Do you have a space you could rent out while you’re not there?
Step four
As you reach your budget goals, you’ll want to add new ones or even change existing ones.
It’s easy to assume that your expenses will remain the same or increase year-on-year, but this is not the case. You can make savings in so many places, from your car insurance coverage to memberships, and, dare we say it, take advantage of those coupons.
In addition to online banking and My Money Manager, we offer online bill pay where you can schedule one-time or recurring payments, track payments, view scheduled payments, and set up custom email or text alerts. You can even see due dates and amounts of upcoming bills. If you have any questions about the above, do not hesitate to get in touch with your nearest branch and one of our team will be delighted to help.