Friday, November 18, 2016

8 Secrets to Building a Budget That Works [Part 2]

6. Monitor your goals regularly

Compare your budget with your actual day-to-day spending. Sometimes a wild card like car repairs or medical co-pays sends you way over budget. But if you find yourself in the red more than once in a while, it is time to look for ways to stay motivated.
Maybe a “just this once” coffee, lunch out, toy for your kid or pizza for the family has burgeoned into an inability to say no. Here’s a phrase that can help: “That’s not in the budget right now.”

7. Be flexible

Suppose gasoline prices unexpectedly spike, or you need $20 for your middle-schooler’s chess club fee. The money has to come from somewhere, so you need to be able to shift dollars from category to category.
Note: This does not mean a license to overspend. Quite the opposite. It means you need to get creative about meeting your needs.
If you want your kid in chess club, it might mean sacrificing a couple of once-a-week lunches out.
Does that seem like more deprivation? Look at it as enrichment for your child. Keeping things in perspective is a major component of that thing called adulthood.

8. Celebrate your progress

In the past 90 days, you pared that consumer debt by $330 — way to go! Your emergency fund is up to $800 — woot! You started that Roth IRA and automated a small monthly contribution — yay, you!
Compare the way you’re living now — taking charge of debt, making plans for the future — to the way you used to live. Remember the feeling of hopelessness, the fear that you would never get ahead? Now you are doing something about it.

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