This Is How to Create a Realistic Weekly Budget
Getting your finances in order requires that you have some kind of plan for how you spend your money. Some people can keep great mental notes and avoid unnecessary spending, but most have to create some kind of weekly budget.
The tough part of making a budget, though, is that you have to create realistic goals. Our ideal goals are the ones we tend to put down first. Then, we try to live by the budget and wind up short.
That’s a hit to our financial confidence, so the most effective way to start budgeting is to create achievable goals that will put us in a better financial position.
Let’s look at some tips for you to use while you create your weekly budget.
Ideas for Creating a Great Weekly Budget
To start, get an idea of your reason for budgeting.
It’s great to have a budget in general because it maintains your financial health and frees you up for opportunities you might need money for in the future. That said, it’s tough to motivate yourself without a clear reason for doing something.
Figure out what it is that you can think of when you’re faced with a really tempting purchase. You’re at the mall and you’re struck by a really beautiful pair of pants, for example, but you remember that your trip to Bermuda won’t happen if you keep buying all of the pants in sight.
More likely, you have a spot you’d like to be at financially. Maybe you’d like to save $5,000 by the end of the year. Whatever it is, write your intention down and place it right at the top of your budget.
That way, you’ll never forget why you’re changing your spending habits.
Identify the Purchases that You Truly Value
The next move in creating a budget is to figure out what you’re already spending your money on.
The painful process of looking at your billing statement can be really rewarding. It’s painful because you can actually see all of the gas station food you bought last month, but it’s rewarding because now you know you have a problem with those purchases.
Go through your spending and ask yourself which things you actually needed. Once you separate your “needed” and “wanted” categories, take a closer look at the things you wanted.
You can’t go through life depriving yourself of everything you want. The thing is, a lot of the purchases we make in the moment don’t bring us that much joy.
Identify the things you bought last month that you were happy about buying. Look at the portion of your budget that those purchases contributed to, and set that amount aside for frivolous spending.
That way, you can splurge a little bit on things that you don’t need but will add value to your day.
Chunk Down from Your End Goal
Your end goal probably has a dollar amount attached to it. A big vacation might cost $4,000, or your savings account might need to have more than that for you to feel comfortable.
Whatever your goal is, take the end goal and break it down to see how much you need to save weekly. Take your average income in relation to that weekly goal, and subtract the amount you need to set aside.
Doing this will give you an idea of whether your goal is reasonable or not. If you find that you’ll be stretched too thin, see if there’s a way that you can adjust the goal to make your life a little easier.
Take the portion of your weekly income that doesn’t go toward your savings fund and start breaking that down as well. The remainder of your income can be divided up among your bills.
Don’t Forget About Your Social Life
Another big pitfall that people make with their budget is the fact that life still needs to be enjoyable.
It’s admirable to make sacrifices to achieve a greater goal. If you have an important goal that you need to achieve, it might be necessary to cut out social spending and other non-essentials.
That said, the point of making a budget for most people is improving their life in some way. You defeat the purpose when you strip your life of the finer things just to have a little extra money.
On the other hand, when people forget to account for social spending in their budgets, they find that they go out anyway and spend more than their budget allows. The trick is to incorporate a fixed amount to spend on things you enjoy.
This is different from buying the occasional candy bar you love or getting a new pair of pants.
We’re talking more about things like dinners, movies, museums, park fees, and more. Try to fit a certain amount of money into your budget for these types of things you can do with your friends and family.
Account for Birthdays and Holidays
If you’re a person who likes to give gifts, you can’t forget about these important moments either.
When you’re operating on a tight budget, that little $20 birthday gift card or a unique gift for a parent can really throw you off. The key is to account for these things and be prepared.
Even if you have to take some money from your savings portion and use it for holiday spending, knowing that you’ll do it in advance can save you a hit to your confidence.
The thing is, you’re going to spend money on these things anyway, so be honest with yourself and just do your best to be prepared for those moments when they come around.
It seems like there are a lot of roadblocks to saving enough money, but you’ll get to your goal if you can plan effectively. The main things are to have some determination, forgive yourself right away if you slip up, and do your best to plan as much as possible.
Need a Few More Ideas?
Hammering down your weekly budget could take some time. You might need a little more advice to get things right. We’re here to help.
Explore our site for more insight into ways that you can get your financial health back in order and start living the life you truly want to live!