by Bo, February 13, 2013
Setting a personal finance budget can be difficult but there are several best budgeting practices that can help keep your budget on track as well as assist in meeting your financial goals. If you’ve been having trouble maintaining your personal budget or are exploring your budget options, we are excited to present a few of the best budgeting practices.
Set a Time Frame
Getting out of debit or gaining control of your budget is much like any other goal. For resolutions to be attainable, a time frame must be set. It is similar to budget management. Giving yourself a set amount of time to accomplish this goal will result in success. Write down your budgeting goals, set a time line and proceed to the next best practices.
Do It Yourself
We sometimes pay unnecessary money for things that we can do ourselves. Good examples of this can be going to a car wash or using a coin counting machine. These are services that can save small amounts of money and lead to more money in a bank account- helping maintain a positive budget.
Cut Back on Coupons
Many financial “experts” will say that clipping and using coupons is a great way to help resolve debt and manage a budget. However, there is one down side to this. As humans, when we receive a deal or something for free, we feel we need to have it, regardless of the fact it may or may not really be needed or useful to us. The same concept applies to coupons. Only use coupons for the items you need and save the rest of the money for other priority things in your life such as bills.
Live by the 60% Rule
A rule to live by for good budgeting is to live on 60% of your income. This leaves 40% of what is made within a household to go towards paying down credit card debits or to put into savings accounts. If a household can budget their money to live on 60% of their income, then they can truly meet their budgeting goals.
Pay Off Debts
A few of the previous best practices above have mentioned paying down or working to get out of debt. By using the money saved from doing projects yourself or by living by the 60% rule, you can hopefully meet your budgeting time-frame goals and become debt free.
Keep a Record of Transactions
Studies have found that by keeping a detailed record of all financial transactions, it pulls financial budgets to the forefront of the mind. By consistently seeing where money is being spent it can put financial spending and priorities into perspective. This will help you meet your budgeting goals.
Review Finances Daily
Along with keeping a record of all transactions, reviewing the state of finances daily can show where money is being spent and help prioritize budgeting goals. Studies have found that adults who look at their bank accounts daily are more likely to be wealthy.
Budgeting Practices and Doing Your Research
Doing your research on the latest budgeting techniques and programs can really be helpful in budget management, by reading books from expert financial gurus such as Dave Ramsey and reading blogs like ours, you can really begin to learn and implement the tips that work best for budget management.