Do you need to budget your money better? Many people struggle to budget successfully and it’s easy to see why. Did you know that many experts say the number one reason people can’t stick to a budget is the invention of the debit card? When using a card, it is easier to overspend as you aren’t actually counting out money. You just swipe your card and go on your way. If you need to learn how to create a budget that you can stick to, why not try the envelope system that many debt reductions experts recommend.
The envelope system is one in which you take your monthly bills, such as your groceries and gas money, and place the actual cash in paper envelopes. Other bills such as your rent or mortgage and utility bills may still be paid with the debit card as they tend to be the same amount, or close, each month. It’s the bills that tend to fluctuate which destroy more budgets than anything else. When you walk into a gas station or grocery store and don’t have a debit card on you, you can’t overspend. If you spend too much, something has to go back on the shelf.
When learning how to budget money, many overlook this simple tool. Others who want to learn how to save money won’t use this method because they say it is inconvenient. There are ways around this though, even if you have a spouse or significant other who won’t get on board. Rather than using cash at the gas station or grocery store, when you get paid take the envelope to the store in question and buy gift cards. By doing so, they can still have the convenience of the debit card without the fear of overspending.
Of course, before you actually start using this system, you have to know how to make a budget. This is easier said then done. You must sit down and determine all income and all expenses. Once you have a list of each, you put the income at the top of the page and start deducting expenses from it. Start with your utility bills and mortgage and work your way down. Be sure to cover the necessities first as they must be paid. This only includes rent or mortgage, utilities, insurance and food. Everything else is a luxury that can be cut.
If you find after doing so that you still don’t have enough to pay for those items, major changes are going to have to be made. Only by having a budget though can you even determine if this is the case. Sit down and get started today. You can move forward if you know where you currently are.