Creating and sticking to a budget is no easy task. Especially for a busy family with lots of activities on the go, taking time to create a budget and then review it so you stay on track may seem like an impossible task.
But making and following a budget is probably one of the most important ways to keep your family’s finances on track! So start small: here are three steps to help you get started on the road to paying down debt, preparing for the the future and achieving all your financial goals with a great budget.
1. Be honest
Review what you spend each month – on everything from food and utilities to dinners out and clothes for work or school. Review what you actually spent the past few months and use that to build the budget for the future. Be transparent with yourself and realistic in your monthly estimates to ensure you can be successful (don’t pretend you only spend $5 on coffee each month if you really spend $20!).
Don’t forget the expenses that come up less frequently than once a month – such as seasonal costs for household maintenance or children’s sporting equipment or school supplies.
2. Keep track
Once you have a plan mapped out, start tracking what you spend so you can stop yourself before you go over budget. Many credit unions offer built-in tools with their online banking platform or mobile app to set-up alerts and track spending real time.
Or if you’re not feeling tech-savvy, a good old fashioned spreadsheet or pen and paper work too!
3. Regularly review and update
Each month take a hard look at what you budgeted versus what you actually spent. If each month you’re going over (or staying way under) budget, it might be time to tweak things to keep yourself on track.
Map out how long it will take you to pay down debt or save for a specific goal and update your budget accordingly. If you want to take a big vacation in six months, for example, you may need to ramp up your savings plan in advance to make sure there’s enough put away in time.
Need help? Talk to your local credit union. We offer the same products and services as the banks, but with award-winning customer service and profit-sharing. Find your local branch to learn more today.