Now I am no expert on this situation, but I want to talk about some tips that have really helped my husband and I pay off our debt as well as save money to buy our house. We do use the Dave Ramsey method and we have tweaked it just a little to what works best for our situation.
Budgeting can seem very overwhelming, but once you get into the habit of doing it the whole process becomes second nature. As crazy as it sounds, you kind of get addicted to saving money. Budgeting can work with any income and debt you just have to find the right balance that works for you.
Below, I am going to talk about some tips to help you get your budget in order and to help keep you on track whether it be for paying off debt, saving money or just wanting to be smarter with your finances:
My first tip is:
- Get Rid of Any Unnecessary Subscriptions
When establishing a budget look through your bank statement and get rid of any unnecessary subscriptions that you may have. My husband and I dropped a lot of little things that were “money suckers”, and it gave us a lot of extra money each month. Whether it’s a magazine subscription, makeup, clothes, anything that is unnecessary while you’re trying to pay off your debt, GET RID OF IT! I know this sounds crazy, but hear me out I will talk more about your “fun money” later.
- Write Out All Of Your Expenses
When budgeting it is important to be transparent about your finances. Whether you are single or you share finances with someone else it is important to write down your income and all of your expenses to see exactly where your money is going. Writing it all out really gives you a new perspective when you subtract all of your monthly bills from your income, and you realize how much unnecessary spending you might be doing. This was one of the most helpful tips when we made our budget and I will always recommend it!
- Figure Out Your Budget With Your Income
Total up your income whether you have a single or dual income, and split it up by pay period. Whether you get paid weekly or biweekly. This will determine how you set up your bills and how much will come out each pay period. We are paid weekly so we split our bills up weekly to have less strain on our paycheck when paying our bills. If you split your bills payments in half according to when they are due you can put them in a separate account to be able to pay off your bills more easily each month. For example, if we have a bill that is 400 and it is due at the end of each month, since we get paid weekly we will take $100 dollars from our paycheck each week to put towards that bill to pay it for the month. You can do this with your bills according to your pay period, to have less strain when splitting up your money when you get a paycheck.
- Use Cash For Whatever You Can
One of the biggest things that has helped us to cut down on spending is by paying with cash on everything that we can. We have bills that come out of our bank account so those we leave money in a “bills” account to be automatically withdrawn, but for our spending money we use cash. This way you can physically see the money going away and it has really helped us to get back on track with our spending. This may not work well for everyone but that has helped us out a lot!
- Build Up A Savings
When using the Dave Ramsey debt snowball you are told to save $1000 in an emergency savings and that is SO important! It may take you awhile to get there depending on your situation, but if you have any unexpected surprises along the way at least you have that as a little cushion! However if you do have an income where you can put more back have a goal for yourself something that you are working towards whether it be saving for a house, car, vacation always put at least some money back into your savings.
- Make Room For Fun Money
When you go on a budget it is so easy to think “I won’t be able to go shopping anymore or go out to eat”, but that is not true! Put a little bit of “fun money” into your budget if you see something that you like or if you and partner like to go on a date night! If you don’t use that money you can always save it up for something bigger for yourself and build on it over a few weeks! Whether it is 5 dollars to get a coffee or it is $50 dollars to go shopping, give yourself some money to spend on yourself sometimes so that budgeting doesn’t seem like it will take away your freedom!
- Make Your Budget Attainable
Don’t stretch yourself so thin that you are struggling with your budget and don’t take it lightly to where your lifestyle doesn’t change and you go back into the old ways of spending. It will be a BIG adjustment in the beginning but it is SO worth it in the end to have financial freedom! Make a budget that allows you to live within your means and still be able to do the things you want. You can do both, you just have to find the right balance!
Like I said before I am not an expert, but these are some of the things that have helped us along the way! Everyone’s journey is a little bit different so you have to budget fro what works best for your family, feel free to share your budget tips with me in the comments I love to hear from you!
Until Next Time…..
Riley Jo XOXO