Posted in Savings on December 29, 2020
Dealing with money shouldn’t be a nightmare.
We all have issues with finances from time to time, whether it’s not having enough cash left over after paying some unexpected bills or struggling with finding money for a last-minute expense. But the thought of checking your bank account shouldn’t fill you with dread.
If you’re constantly panicked about cash, then maybe it’s time to start making some small regular changes to your day-to-day life. Here are some quick cash tips to get you on the right track.
Before the next month even starts, make sure you have a plan in mind. Budgeting to zero means that you give every dollar a name. You decide exactly what you’re going to do with your cash, and why, and ensure that there aren’t any nasty surprises along the way.
If you’re living with a partner, then it makes sense to plan your budget with your other half, as they might remember some expenses that you might not have considered before. Grab some of your favourite snacks to make the experience a little less painful and go through the bills one by one until you’re sure you’ve got everything ironed out.
Some months you’ll have to budget for different expenses than you would in other months. For instance, there are times when you need to worry about back-to-school supplies, or anniversary presents. It always helps to have a “misc” category in your budget where you can save some extra cash aside just in case. However, you can also reduce your risk of nasty surprises by looking at every month as unique.
Remember to think carefully about what kind of costs each month might bring, and whether you need to start saving in advance for certain expenses like Christmas. Putting a little cash away each month for the “extras” will help to prepare you for those moments that you need a little extra cash.
Knowing your priorities when it comes to handling cash will help you to ensure that you’re always making decisions base don what’s right for you and your loved ones. Saving cash for an emergency fund should be pretty close towards the top of your list. However, it’s also worth paying off your debts first if you can, as this will reduce the amount of money that gets waste on things like interest.
If you think that you need to buy something immediately to help you get the most out of your budget going forward, like a car that will take you from and to work each month, then consider a loan, and how much that’s going to cost you each month in extra expenses.
Money management is something that many of us don’t spend nearly enough time thinking about. We set our bills to be paid automatically when we can and take life as it comes for the most part. However, being active about how you use your cash, instead of passive, can make a huge difference to your lifestyle. Make a schedule where you can check on things like how much progress you’re making towards your savings goals, and how much of your debt you’ve paid off.
Part of your schedule should also involve checking in on your budget and deciding whether it’s still as effective today as it used to be. You might decide that you need to dedicate more of your budget towards fun and entertainment, or that you need to put some of your savings into a new investment category so you can build your wealth.
Give yourself a break. No matter how hard you try, there’s always a chance that you’re going to miss something that you should have taken into account for your budget. There’s nothing wrong with making mistakes from time to time, as long as you learn from them. Having a buffer in your budget that you can turn to when things go wrong means that you’re less likely to panic when unexpected expenses arise.
It might take a little while for you to build this budget buffer initially, especially if you’re still paying off debts and dealing with your emergency savings, but you’ll get there eventually. Don’t beat yourself up from going into that buffer every so often too. You’re going to need time to figure out a strategy that really works for you.