The beginning of a new year is a time to dream of a better future and set resolutions to achieve those goals. One of the most frequently set New Year’s resolutions involves finances, whether budgeting, saving money, getting a raise, or making a large purchase. If creating and sticking to a budget is one of your goals for the new year, you are in the right place!
East Ohio College equips you with the tips and tricks to designing a budget that works for you. Keep reading to learn EOC’s top tips for budgeting that will help you achieve your financial goals!
Think About Your Financial Goals
The first step in developing a budget is to consider what your financial goals are, both short and long-term. Examples of common financial goals include creating a savings account, paying off credit card debt, making a significant purchase like a house or car, or paying off student loans. Thinking about what you wish to accomplish in the year is an excellent way to assess your financial situation and approach budgeting in a way that works for you.
A helpful strategy for goal-setting is the SMART goals method. Breaking your more significant and optimistic goals into specific, measurable, attainable, realistic, and timely steps will help you stay on the right track to achieving the overall goal. Our blog, How To Create SMART Goals, provides tips and guides on converting any goal into the SMART goal process.
Consider Your Income and Expenses
Once you know the financial goal, the next step is to examine your monthly income and expenses closely. Start by adding up your monthly income and monthly fixed expenses. Fixed expenses are recurring costs that are the same or slightly different every month, including things like rent or mortgage payments, car payments, phone bills, credit card payments, and more. Once you know your total monthly fixed expenses, you can move on to adding up variable expenses.
Variable expenses are costs that do not follow a strict schedule and vary from month to month. This expense includes groceries, gas, dining out, entertainment, utilities, and more. Looking back at previous months can give you an idea of how much, on average, you spend in these categories and should, therefore, allow money in your budget for them.
Be Realistic
Budgeting is a tool that provides you with the resources for you to control your money, not the other way around. That said, it is essential to be realistic about your financial situation, spending, and needs. Being realistic will set you up for better success with sticking to your budget. For example, let’s say you create a budget with a low budget for expenses like clothing or dining out. You will probably spend money on those things despite not being within your budget. By being realistic and allocating money for those things, you can still indulge in things that bring you joy while staying on track to meet your financial goals.
When being realistic with your spending, an additional suggestion is to analyze the subscription services you pay for monthly and try to unsubscribe to those you don’t use often. You may be paying for things you don’t realize, and while the individual amounts seem small, they add up quickly. Saving even a small amount of money gives you extra to budget for other things. Many online services are available to gather your subscriptions into a list that lets you see everything at once and determine what’s worth keeping.
Be Adaptable
In addition to maintaining a realistic budget, flexibility is key. Events such as holidays, birthdays, vacations, and other special occasions may necessitate extra spending beyond your regular expenses. By planning and incorporating these occasions into your budget, you can enjoy them without the anxiety of exceeding your financial limits.
For instance, if you have an upcoming vacation, you might allocate less of your budget to groceries and more towards gas and dining out to cover those additional expenses. Remember that you control your budget; making your money work for you is the most effective way to maintain your financial goals.
Follow A Template
Now that you have evaluated every aspect of your financial situation, it’s time to arrange the numbers and establish a concrete budget. Utilizing a pre-designed online template is a great approach, as it comes with the essential formulas already set up, allowing you to customize it to fit your needs while the template handles the calculations. Many printable templates are available for monthly budgeting if you prefer a physical budget. Opting for a template from a trusted source can assist you in visualizing your spending, discovering potential savings, and fine-tuning your budget to achieve your financial goals.
EOC Is Here To Help Make This Year The Best Yet!
Are you planning on making changes to improve your life this year? If so, East Ohio College is here to help you further your education with nursing, allied healthcare, and professional services training. Our hands-on approach, student services, and career management will help guide you toward your new career.
Don’t spend another year wondering what your life could be like; take the first step toward a better future by requesting information from East Ohio College today!