When life events occur, there comes a point in time when we soon realize that our monthly budgets need some serious re-evaluation. Whether it’s to start a college savings plan, to pay for unexpected medical bills or to purchase a home, many of us will be required to restructure our spending in order to achieve our specific goals.
I recently sat down with my husband to do some budget revisions of our own. I can tell you – it’s not always the easiest task, and it can be a bit of a process, but the end results are definitely worth it! Here are a few things I took away from our assessment:
Keep your eye on the prize: Set a goal and keep referring back to it. I found it helps to put things into perspective – do we really need to spend $100 monthly ($1200 annually!) on clothing, or could that money be used in some way to help us reach our goal?
Look for alternatives: If there’s something you enjoy or need, try to find a way to keep some form of it in your budget, but at a reduced cost. If you like to relax and watch TV after work (as my husband and I do), but can no longer afford to keep that pricey cable package, try a basic cable package or eliminate the cable expense and rent free DVDs from the library. You’ll still get to do the things that you love, but for less!
Prioritize Spending: This helps you think about and remember what’s truly important. Priorities will be different for each individual or family, and there is no right or wrong way to evaluate what’s most essential to you. Though, typically, top priorities include housing expenses, secured loans, utilities and insurances.
Communicate: Get the members of your household involved, make sure everyone understands any changes to the budget, and be sure that they are on board to make the updates a success. It can also help to have a budget meeting at least one a month to track progress.
Keep these tips in mind and hopefully you’ll be able to build a budget that works better for you. If you would like additional assistance in creating a budget that works, schedule an appointment with the budgeting experts at Clearpoint Credit Counseling Services today!