Continuing with the theme of helping you improve your life and work on New Year’s resolutions, this week the Liv Avenida blog wants to give you some pointers to budgeting that will help you feel secure and happy this year. If you keep track of the flow of your funds going in and out of your bank account, you can make better spending and saving decisions and plan for what you want to do with your money. So read on to find out how you can approach your money and have more financial freedom in or outside of your apartment in Chandler, AZ.
Build an emergency fund.
Emergencies, unfortunately, do come. Prevent the panicked feeling that comes when they do by building an emergency account. Dedicate yourself to putting something into that account each month, according to how much you want in the account and when you want it in by. For example, if you want to have $2,000 in your emergency fund by this time next year, you should plan on putting in about $166 each month. Decide what rate works for you and commit, even if it’s uncomfortable for a little bit. It will pay off and you will feel more secure as you do.
Build a separate savings account.
Your savings account should be different from your emergency and checking accounts. Prepare for a comfortable lifestyle or for your next big purchase by setting up an account for that specific thing, whether it’s a new car, a house, next year’s college tuition, or a fun trip. Making withdrawals from your paycheck automatic can help you save without even going through the physical or emotional hassle each month.
Keep track of your spending.
Knowing what you spend includes more than just realizing that you spent some money on gas, food, and other things. Have a place for where your money is going so you can discipline yourself on where to draw the line and stop spending. The simple concept of not spending what you don’t have (skip to 4:05 for the SNL video) can really fly over your head when you have a lot less than you think you do. Be aware so you can spend responsibly!
Let yourself donate.
Sure, money buys you a place to live, food to eat, and entertainment to enjoy. But despite these things, money itself does not equate to happiness. Create a secure lifestyle for yourself by budgeting properly so you can feel happy because of other things, like the relationships you build with others or the knowledge that you’re contributing to the world in a positive way by donating some of your funds to a good cause. Separate yourself from the need to hoard money by giving it away. It will bring you much more peace and happiness in the long run.
What helpful tips do you for budgeting better and making better financial decisions? Share your wisdom in the comments. Thanks for reading. Happy budgeting!