Tips on Setting a Budget

Now that you've figured out how to make a budget (see last month's blog here). It's time for some actual tips on setting your budget.

Tip #1: Based your budget on how much you get paid! If you are paid weekly, bi-weekly, or monthly create a budget that is a weekly, bi-weekly or monthly.

Tip #2: When listing expenses, multiple them by 4.3, remember 4 months of the year actually have 5 weeks! So multiplying by 4 isn't accurate.

Tip #3: Divide all your BIG expense (auto insurance, rent, loan payments etc.) over the 12 months. This way you should be able to pay them in full when the time comes. Paying monthly is ok for cash flow purposes, but they do charge 2-5% to do this.

Tip #4: Set boundaries–going to the bank only once a week (including using ATM machines)

Tip #5: Use cash over credit whenever you can.

Tip #6: Use a journal to keep track of your money! What do you spend on a daily basis and on what?

#budget #financialliteracy #tips