How to create a better budger for you

It’s safe to say I need a money resolution after spending way too much this holiday season. I think it’s the perfect time to come up with a few for 2018! Here are a few resolutions I came up with for 2018 that you can use too.

Resolution #1: Track spending

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The first step in changing your spending habits is recognizing them. How can you do that if you don’t know what they are?

Write down everything you spend for one month! You might be surprised at how quickly your daily latte adds up. Once you have a list of everything you’ve spent on for that month, it will be a lot easier to see what you need to spend and what you can cut out. Maybe you notice you eat out too much. Although you don’t have to cut that out entirely, you might consider eating out only once or twice a month.

Too lazy to write anything down? There are tons of budget apps out there (my favorite is Mint) that will track your spending automatically and give you an auto-generated monthly report. Just link your bank account to the app and you’ll be set!

Resolution #2: Make a budget (and stick to it!)

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The second logical step to tracking spending is making a plan to not spend as much.

Figure out the essential things you need to throw money at each month: utilities, rent, gas, bills, insurance, groceries, phone bills, cable, loans, etc. Subtract that number from your monthly pay check and see what you have left. After doing that, you’re not done yet!

Budget a portion of this remaining amount for a savings account. The rest of your check can go to things like nights out, clothing, the new watch you’ve been eyeing, and other miscellaneous expenses.

As a rule of thumb, 30 percent of your paycheck should go to paying bills and the like and 25 percent on food and utilities. That leaves 45 percent to spend on anything else you need (or want). Just make sure to prioritize: If you like to spend more money on clothes than a fancy dinner, then budget your income to reflect that.

Resolution #3: Make a rainy day fund

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Remember that 30 percent of savings I talked about? This will come in handy when you have unexpected expenses crop up. Maybe one of the kids needs braces. Maybe you need to replace three flat tires. Maybe you pet suddenly comes down with a fever. Whatever the case, having a rainy day account will help when it starts pouring.

Resolution #4: Cash only!

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It’s easy to overspend when all you’re using is a card and you don’t physically see what you’re spending. Following a cash only rule for your everyday purchases will limit your spending significantly. Although I know not every purchase can follow this rule (goods such as TVs are almost always purchased with plastic), setting a paper limit in your wallet will show you visually how much you spend.

Resolution #5: Make money on the side

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You don’t have to get another job to make some more income. Consider being a rideshare driver for your daily commute, delivering food, or selling clothes you don’t need. All of these methods are easy and don’t require a drastic change in schedule.

I’m pledging to make all these changes for 2018. Who knows, I might actually be able to afford my dream vacation! If you follow these tips, so can you (and a lot more)!

Have any more savings resolutions? Leave a comment below!

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