When we started to get serious about money, I looked at so many ways to live on a budget. From the different systems to try to the hundreds of ways you can live frugally, it is all great stuff but it can still be a struggle unless you put this budgeting tip in to practice.
ACT YOUR WAGE, it may sound a little harsher than intended, but it will be something you are likely needing to hear. You may think you are already doing this but if you are not reaching your financial goals chances are your not! This means start being realistic with what you can afford to do each month. This doesn’t mean stop dreaming, as I really do believe we can all reach our goals we just have to be realistic on how long it will take or we have to get creative to get there. This is not just for those on small incomes, yes this may mean slightly more to families where you are counting every penny but if you are bringing in a large household income and you don’t seem to have enough each month this applies to you to.
My suggestion to you is for the next three months take your outgoings to the pure basics this means no extra spending other than bills and essentials such as food and fuel (emergencies and debt payments are essentials). This will allow you to see your priorities, what is important to you? What were you and the family truly missing?
For an example here are ours:
- Education/sport for children – money for sports clubs, tutors and the nursery
- Holidays – we are not talking fancy holidays right now as our last few have been camping in a tent but we do need to get away.
- Food – you make think this is an essential and you would be right but we do like our food so we are willing to sacrifice in other areas to have a big enough food budget to enjoy what we want.
Now look at your budget again, once you have looked at your bills and essentials add in your priorities. Remember be realistic, so for us right now we can’t afford a sports club a day for each of our children but we can afford a couple a week. We would like two weeks away so we can’t afford to go aboard for that long so we opt for camping. Your priority maybe to pay off debt so anything above the basic may go there (great priority). By doing this you will cover the essentials but yet feel fulfilled and feel like you are controlling your money. Just remember to not allow quick spending decisions to slip back in.
What are your priorities?