Budgeting has a negative connotation, but it’s an essential if you want to get your finances under control. If you haven’t updated your budget in a while, spring is the perfect time to get it in shape.
Dust Off the Old Budget
Pull out the last budget you created. Is it still valid? Chances are at least a few things have changed if you haven’t updated your budget in several months.
Review each bill listed on your budget. Do you still pay the bill? Has the amount changed? For example, the amount for budget billing on utilities might change once or twice a year based on your consumption. Remove any bills that are no longer valid. Update the amounts on the bills you still pay.
If you have any new payments that started after you created your budget, add those in. Do you have a car payment that you didn’t have before? Did you join a gym with a monthly fee? Include every expense so your budget is accurate.
Has your income changed? Perhaps you got a second job or had a raise since you last budgeted. Maybe the amount you receive in child support changed.
Track Your Spending
Now that you have your budget updated, it’s time to see if you’re following the limits you set for yourself. Your bills are likely on track as long as the amounts are entered correctly. The discretionary spending is where most families go off budget.
It seems tedious, but keep those receipts for several weeks. Add up how much you’re spending on groceries, toiletries, eating out, gas and entertainment. Are you staying within the range you originally set for yourself? If not, are you still living within your means and contributing to savings? If you’re spending more than you make, it may be time to cut back on your spending.
Spring is often a time when people cut back on junk food so they can fit into those summer clothes, but it’s also a good time to cut back on spending. Summer often comes with lots of entertainment options — which usually means spending money. If you get in the habit this spring of spending less, you may be in the habit of picking and choosing when the summer invites start rolling in.
Areas that are easiest to cut back on are groceries and entertainment. Find a few budget meals that help you cut back your grocery bill each week. Going meatless is an easy way to do that. Cooking more meals at home also helps the overall budget.
Spring Into Financial Well-Being
The time you take now to spring clean your budget will give you a solid financial foundation down the road. You’ll feel better about your finances when you know what’s going on and you know you’re living within your means.