Smart Tips For Budgeting Your Money

by The Smarter Wallet on September 8, 2010

Doesn’t budgeting seem boring at times? Call me dull, but I have always enjoyed it. I love the challenge that budgeting offers and when things have been a bit sticky on the financial front I can go back to budgeting to solve all my problems.

I’ve been budgeting hard this year -– and I intend to continue –- as we had a large bill to pay that wiped out some of the savings we had worked on. My first reaction was relief that we had had the foresight to put away some savings in the first place (thanks to budgeting initially). But my second reaction was to take a fresh look at the budget to see how we could go forward from there and replace some of those savings. If you’ve got debt to pay off, then following some of these budgeting tips can help.

If you’re planning to budget, you can use a great desktop money management tool like YNAB. You can sign up for a free trial here. For more information, you can also check out our YNAB software review.

Smart Tips For Budgeting Your Money

When you’re thinking about beating your debt, it may feel like forever when you deny yourself things as you focus on your goals. And that made me think about treats. Where exactly do treats fit into budgeting? We’ve got priorities to think about like paying bills and replacing savings. And the word “treat” doesn’t really seem to fit in with that. We spent the first few months of the year doing everything we could to cut down on outgo in order to replace what we needed to. And treats didn’t fit into the equation during those months.

But then we realized that you do need a bit of a treat as well. I figured out how to fit treats in with the rest of the deal.

So here’s how I did it. I figured out what the monthly outgo was (and since we are self employed we had to allocate money to go into a tax account in order to pay that in due course as well). Once that was done, it was time to look into money saving ideas and to think about what we were spending every month. Now we can’t do a lot about some bills, but others can be reduced; for instance, our food bill was a prime area to tackle.

I’m the cook in our household so one thing to try was to see how we could come up with cheaper meals. I switched to a cheaper supermarket and started buying different things to cut the food bill down. Not only did I have the pleasant side effect of finding new foods to try at a cheaper price, but I also reinvented my love of cooking altogether. So in a way, this was a treat for me before I even started.

But once we had those initial moves in place, we started thinking about a treat or two as well. Treats are a monthly thing now instead of a daily or weekly thing. And they don’t always cost money. The other day, we had a day out to a town we’d never been to before. We never spent a bean except for the gas to get us there in the car. Here’s more on how to budget.

And after three months of budgeting, we decided to give ourselves a bigger treat in the form of a Nintendo Wii. I’m waiting on delivery today even as I write this. It’s a bigger treat for sure, but it’s cheaper than a gym membership and we both wanted to get more exercise. So once again, there is method to our madness. And at this point, we’re not expecting to have any more treats for a while.

So yes, treats can fit into any budget. Being sensible about things is important — if you want to designate an amount of money for your treats each week or each month, then this is something you can do. But not all treats are of the monetary kind. And even when they are, some can last for a long time. Just like the Wii will.

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{ 1 comment… read it below or add one }

1 Nicola September 14, 2010 at 11:54 am

Good advice. Treats, budget cooking and putting money aside are all great tips, but you really need to get back to basics and think about everything you spend. Make a note of everything to ensure that nothing goes unmissed. And if it’s not in the budget, then don’t get it!

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