If you are ready and prepared to get your budget in check, you are in the right place. If you are landing here for the first time, I encourage you to check out Part 1: How to Get Your Budget in Check before continuing.
In Part 1 we discussed the basics of getting your budget in order. Including, understanding your income, identifying your debt, and devising a plan to get your budget in order. In Part 2 we will take it a step further and discuss how to get your budget in check by identifying budget “killers”, executing your plan, and reassessing and readjusting your budget.
Let’s jump in.
Idenitfying Budget Killers
Once you have gotten a clear understanding of how much income is coming into your household, now is the time to identify the things that are killing your budget. We all have our vices and things we like to eat, drink, listen to or do at the expense of maintaining our budget. Automatic reloads on your Starbucks account could be killing your budget. $8.99 per month to an unknown subscription could be killing your budget. Stopping at Wawa every morning before work could be killing your budget.
Your responsibility here is to look over your bank statements with a fine tooth comb and identify the areas where you are spending excess. If you haven’t completed your free budget check up, it may be a little difficult to continue. If you have, it is safe to say your budget killers are the area in which you are spending in excess. Some of those factors we cannot change immediately (such as you rent or car payment), but others we can (entertainment, dining out). When you find the areas you are overspending in, you have successfully identified potential budget killers.
Executing your Plan
Now that you have identified your income, analyzed your spending, and identified your budget killers, now comes the time to execute the plan. This is where things get rough! No one can make you follow through with your plan but you. What monetary goals have you set for yourself or your family? These are the things that will keep you pushing forward. To make it a little easier, put those goals up in a place where you will see them daily to help remind yourself of why you chose this path.
If you have allocated $20 a week to spend on coffee/breakfast items, I would encourage you to take that out as cash. This helps you to avoid going over in this budget category. We quickly forget how much we’ve spent when just slide that card! Measures like these are the things that you will need to put in to play to ensure you are executing your plan as effectively as possible. If you mess up one day, that is okay. Each day is a new day to get on and stay on the right track. Being in control of your budget does not occur over night.
Reassessing and Readjusting
At the end of each month (or as often as you’d like) you should reassess your budget and adjust as necessary. Many factors cause our budgets to fluctuate, that is why having a budget requires consistent assessing and adjusting. A budget is a living breathing document, not one
To save your sanity, I’d only do this once a month. Reflect on your past month and see where things need to be altered. This does not mean increase categories where you are overspending! This means plan accordingly so you do not. For instance, if I am overspending in entertainment, I may preplan my outings with friends and not accept any additional invitations to events for the month. The power of “no” is your friend when it comes to keeping your budget intact. If you allotted much more to an area and ended with residual funds, you can move that to other areas of need. Neglecting to reassess and readjust your budget, will result in an unusable budget. One that will require you to start anew.
Now that you are all ready to get your budget in check, go out and dominate! Let me know what things you are doing to ensure you are keeping your budget in check and what tips you’d like to see to help you stay the course.
Keep doing (the best) you boo!