Your finances are finite. You must carefully choose when to spend and when to save your money, but you can only do that when you’re able to both know what your budget is and stay within it.
The problem is that many people can’t do this. Something as seemingly simple as balancing your budget becomes an incredibly difficult task that seems to be filled with a limitless amount of twists and turns.
Below are five tips that will help you balance your budget and stay on track financially.
1. Try Not to Spend
It might sound silly, but preventing yourself from spending more than you need to is the cornerstone of sticking to a budget and keeping it balanced. A monthly budget comes down to simple math, but many people seem nearly unable to distinguish between what is necessary and what is accessory.
For example, consider if you really need that fancy watch that’s gone on sale or that new set of golf clubs. If you keep yourself from spending now, you may be able to spend on something more critical later without expanding your debt.
2. Pay Down Debts with What You Save
NerdWallet states that the average American owes over $5,000 in debt. This makes debt one of the most common reasons that you might want to keep track of your budget.
Given that your goal should be to save as much as possible, you should use every extra cent you have to pay down your debts. This may be painful in the short run, but it will benefit you over the long term.
3. Use Checks Instead of Plastic
Personal checks leave a paper trail that allow you to tally how much you’ve spent out of your account. You don’t need to worry about merchants authorizing charges or other complicated processes that can give you false positives as to how much your debit account actually has.
If you want another reason to use checks, then consider one of the many personal checks available from places like Checks Superstore. You’ll even have something comical, cute or caring to glance over when you’re balancing your checkbook.
4. Switch to Another Savings Vehicle
It’s too easy to dip into your savings account when you find that you’re not keeping your budget balanced. You’ll end up eating away at your savings when this happens.
Consider taking a portion of your savings and setting it into savings vehicles designed to have periods. Yearly CDs can prevent you from spending your savings while earning you more than most savings accounts would.
5. Plan for the Unpredictable
Things like emergencies should always fall outside of your budget. You should have a separate pile of money saved under your mattress for a particularly rainy day.
Trying to budget for emergencies will only make balancing your budget even harder. You’ll have far less to spend, and you’ll be unable to take care of an emergency when one arises.
Planning for the unpredictable can be done by putting 5% to 10% of each check straight into a savings account. You’ll find that you don’t really miss that money and, because it’s gone before you draw up your budget, you’ll learn to live without it while having a rainy day fund.
Balancing Your Budget Doesn’t Have to Be a Herculean Task
You shouldn’t have to bend over backwards to balance your budget, but too many conveniences can make it seem like you need to. That’s why keeping track of your expenditures with checks, reducing your debts first, using alternate ways of saving money and a different way of looking at your money can help you keep your budget within the boundaries you set.
Each of these practices aims to make the process of budgeting simplified, which in turn makes it that much easier for you to spend only the money you plan to spend. You’ll even have some money to spend on things that you can’t predict while slowly being able to grow your wealth.