Making Your Budget Work In The New Year

Over the years, you have mastered the art of “creating a budget.” Unfortunately, the knack of “sticking to a budget” still eludes you. And that really is the whole point of creating a budget in the first place.

Thankfully, this is a new year. A clean slate. A fresh page in the ledger book. And over the next 365 days, you can prove that you possess the skills required to not just design an awesome budget, but adhere to one too. Here are a few tips to help you succeed.

1. Savings=Priority One

The unexpected expense poses a massive threat to your budget, so you need to prepare for it–whatever it may be. This means creating an emergency fund that you contribute to each and every month.

You also need to develop long-term savings goals and include these in your budget. This includes things like retirement savings, accumulating a deposit for a home, or paying for a European getaway. A good way to ensure that you stick with your savings plan is to have these funds automatically deducted from your account and deposited into your chosen savings plans or investments.

Forbes‘s “10 Surefire Ways to Build Your Wealth in 2015” recommends using visual reminders of the things you’re saving for to help you stave off spontaneous purchases. Placing a picture of that coveted Craftsman in your wallet may just do the trick.

2. Owe No One

If you can’t afford to pay for it with cash, don’t buy it. Adhering to this simple rule will help you avoid accumulating budget-busting, interest-accruing, “sinking in quicksand” debt. In “How to Create a New Year’s Budget that Sticks“, financial guru, Dave Ramsey, makes paying off debt a top priority, recommending that you pay off the smallest debts first and then work towards larger ones.

3. Eliminate Waste

If you take a close look at your spending, you are likely to discover that you are paying for things that you don’t really need or don’t use. Do you keep renewing your gym membership in the hopes that you will eventually develop a regular fitness regime? Do you pay for HBO, but never have the time to watch it? Think of the money you can save by only paying for the things that give you the most bang for your buck–the things you actually need.

4. “No” is a Magic Word

If you have finely honed your ability to say “no” to yourself–no, you cannot buy that Pandora bracelet. No, don’t you need a bigger TV–you now need to concentrate on saying “no” to others. If your friends expect you to join them as they eat at expensive restaurants, purchase front-row concert tickets, or shop as a form of entertainment, you will likely need to explain your situation and say “no.” This doesn’t mean you shouldn’t partake in some of the fun. It just means that you have to be more careful about how you spend your money and which activities you can afford to participate in while still adhering to your budget.

5. Add Income

The most obvious solution to an over-stretched budget is to make cut-backs. Trim the fat. Rid yourself of unnecessary expenses. What if you could increase the amount you have coming in as well?

In US News‘ “8 Steps to Creating a Personal Budget,” Certified Financial Planner, Leslie Beck, recommends taking a part-time job or selling something that is just sitting in your closet taking up space in order to keep your budget on track.

So open up that pristine new ledger book and put your budget-composing prowess to work. After all, this is the year that these efforts will not go to waste. This year you will become a budget-following specialist and get a firm reign on your finances.

What tricks do you use to help you stick to a budget?

About Author: Kimberley Laws is a freelance writer, avid blogger, and owner of several pairs of animal slippers. You can follow her at The Embiggens Project, Pinterest, Facebook, and Google+.

Kimberley Laws

Kimberley Laws is a freelance writer, avid blogger, and owner of several pairs of animal slippers. You can follow her at The Embiggens Project, Pinterest, Facebook, and Google+.

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