Making a budget that saves money and still gives you room to breathe is not impossible. If you can follow the next seven steps then you can improve your finances within a month.

How To Budget Easily

• Track what you spend in two weeks. It’s hard to cut back if you don’t what your weak points are, so grab a little notepad and write everything you spend for 2 weeks.
• Withdraw from your bank’s ATM once a week. Take out money you need to eat out, tolls, parking fees, etc. If you run out of money, then make a peanut butter and jelly sandwich or bring leftovers for lunch.  Do not go back until the next week!
• Use you cash, not credit cards. Don’t defeat the previous step by switching over to your credit card. This will help you to stop acquiring new debt, which in turn can drain your savings. National average for standard, variable cards is around 14%, so eliminating new debt will help you.
• Cut spending in one category. If you do it slowly then it can motivate you into staying with it. My suggestion is to start looking at shopping and eating out expenses. Try either going to cheaper places or reduce the amount of splurges on eating out.
• Put that money saved into an emergency fund ASAP. You won’t notice it and you’ll be building a financial cushion. Try helping yourself and deposit it into a high interest savings account.
• Base a tentative budget based on what you learned the past two weeks. This will help you avoid a rigid or unrealistic budget, which will only frustrate and discourage you.
• Repeat. Keep working at this. There’s no magic bullet when it comes to savings.

It’ll get easier as you continue on this budget.

Your Take

My question is how do you organize your finances now? How is it working out? What works well? What is a weak point? I’m still trying to cut down on eating out.

Photo Credit: Maui ʻāina

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