3 Simple Tips to Make Budgeting Easier


Photo by Karolina Grabowska

Photo : Karolina Grabowska from Pexels

Nobody is the best budgeter on their first try. Like any skill in life, budgeting is something you develop over time with practice and patience. Here are three tips to help you strengthen this skill today. 

Try the Zero-Based Budget

Money without a purpose is money you're going to spend, and it won't always be on useful things. So, give every dollar a job.

Assigning every last cent to a task is a major tenet of the Zero-Based Budget. This budgeting method says you should keep assigning jobs until you are left with $0 at the end of the month. 

That doesn't mean you should have zero blinking in your bank account. In fact, having zero dollars in your checking account could be dangerous. You could easily overdraft if something costs more than you expect. Instead, you should keep a buffer balance in this account to help you with these unexpected costs. 

The Zero-Based Budget encourages you to assign every dollar with a goal. Some of these goals will be practical, like paying rent or saving money. Others will be less so, like putting money towards a night out with friends. 

The Zero-Based Budget doesn't eliminate all fun spending. It just makes you more intentional with your spending, so you don't get carried away. 

Automate Your Savings

Saying you'll send $100 to savings is a lot easier than actually doing it. Life is full of temptations that can knock you off your goal. Your favorite band comes to campus, your friends want to go out for their birthday, or you want to upgrade your phone.

If you have trouble ignoring these temptations despite your best intentions, automation can help. By automating your savings, you eliminate having to choose between doing the responsible thing and doing the fun thing in the heat of the moment. 

Once you set up automatic transfers, it's out of your hands; your bank will instead send this cash at the start of the month (or whenever you choose). With your savings taken out right away, you'll be forced to make do with the cash left over. 

Have a Contingency Plan

Savings are there to prop you up when you budget falls short of unexpected expenses. But what's there to support your savings when they aren't enough in an emergency? If you can't put an urgent, unexpected expense on hold, you may consider online personal loans as an alternative backup. 

No two online loans are alike, so the lending experts at MoneyKey recommend shopping around before you borrow. Rate shopping helps you understand the cost of borrowing from various lenders. You can choose to apply with the best of the bunch to secure the lowest interest rate on an online loan. 

All online loans will apply interest and finance charges, which apply on top of your principal. While this is a normal part of borrowing, it does mean you'll spend more than if you use savings. That's why you should always prioritize savings whenever possible, rather than cutting corners with online loans. If you have savings, use them before you borrow.  

Never Stop Searching for Budget Tips 

Today's tips can help you refine your next budget, but this guide shouldn't mark the end of your budgeting journey. Keep an open mind for other advice to become a pro at budgeting.

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