4 Things Your Budget Needs

The word “budget” isn’t a word that excites most people. You think of cutting back, of having to go without. But that’s not always the case. No matter what stage of life you are at or what your income and outgoings are, it is so important for all of us to have a budget. Here are 4 things that your budget needs:

1.Time and Commitment

This is probably the most important point – you have to give your budget your attention. The idea of sitting down and having to go through all your finances is a tedious one. It’s a job that most of us will put off as it’s a pain having to search the house for all the paperwork, scroll through emails for electronic bills, etc. All too often we don’t want to really know how our finances are going as we don’t want to face reality and the possible hardships of needing to cut back.

Stop Procrastinating! It’s a job that needs to be done. Schedule some time, do it and your finances will be so much easier to keep on top of.

2. Be Realistic

We all have to work with what we’ve got. Be realistic about the amount of money that you have at your disposal and also realistic about the money that you are spending. If you have debt, then you must address it. You can’t afford to ignore it, hoping it will go away. There are many ways to address debt and not every option will suit everyone, there’s 0% balance transfers, debt consolidation, debt management plans, etc. Citizens Advice offer free, impartial advice. If you’re looking for motivation on your journey then Instagram has a fantastic, supportive, finance/debt community.

3. Plan Ahead

Emergency Funds

Sometimes in life things happens that takes us by surprise and mean we’re not financially prepared for it. It’s a great idea to set up an emergency fund. This is money that you put away but only ever touch when you have to. It might help if you’re made redundant, unexpectedly can’t work due to injury, have to travel to see a sick relative, etc.

Sinking Funds

We all know the dates of our family birthday’s, Christmas, etc. Yet each year so many people end up having to call on the credit cards as they don’t have enough money in their monthly allowance. Setting aside a little every month for the expenses that you know you have coming throughout the year will help enormously. You might want to set money aside for a holiday, Christmas, birthdays, house renovations, etc.

4. Remember To Have Fun!

Make an allowance for some fun in your budget. If you strip everything back so much that you’re basically cutting out all the things you enjoy, then you’re not going to stick to your budget. I’m well aware that at times people are on such a tight budget that there’s no money left for fun. If you are struggling, then take a look at some fun frugal ideas on our site.