Budget to save money
Keeping a budget is a wise way to save and stretch a dollar.
First, track your expenditures so you know where you spend your money. Take a ledger and write your line items such as mortgage, medical, garden and yard, insurances, food, gasoline, charity contributions, gifts, utilities, etc. I separate each utility so I know how much I spend on electricity, gas and telephone services which includes internet, for example. I also separate the different types of insurance. Everything we spend money on must fit into a line item.
Know your income also. When you transfer money from your savings, note it.
My ledger could be more detailed, but even keeping a general account helps to know where the money is going. If you are spending more on a particular line item, you will know if that needs to be curbed to stay within your budget or whether it is a necessity and something else must be cut.
Budgeting for big bills
For big bills that come biannually or annually, I save a little aside each week so that I have it all when needed. I recommend beginning this early and having a deadline two weeks before the due date or send date. This way, you won’t come up short if there is an emergency or unexpected expense.
Direct depositing a certain amount each paycheck into your savings helps build your savings for future projects also. We started this for a major future project, and it is amazing how quickly funds add up. Since it is not deposited into your checking, you adjust your expenditures according to the amount you receive in the checking for your paycheck. You can use this nest egg for a vacation or whatever you want.
Watching where you spend your money brings attention to how you spend it. Are you spending it on things you don’t need that are chipping away your funds? If so, now you know and can fix it.
Pay certain bills first
Always pay your mortgage or rent and utilities first. Your food budget can be adjusted. When my husband was laid off, we always paid these first. We also always pay our credit card bills in full each month. If we don’t have the funds, then we don’t buy it. You don’t have to waste your money on credit card insurance—the type that you pay toward in case you lose your job. I remember a person trying to talk me into getting it. She said, “What will you do if you lose your income? How will you pay your bill?” My husband happened to be out of work when this happened, and I told her so. I said, “If I don’t have the money, it won’t get charged.” This takes planning ahead and sometimes juggling. I’ve learned I can live without certain things.
The Lord always provided. This brings up a bill that the faithful should pay first before even the housing and utilities—the tithe. It may seem risky, but experience proved to us that it is true. When you tithe to your church, all the other bills get paid. I can’t explain it because the numbers didn’t always make sense, but everything did get paid by the due dates. God is faithful. You can trust Him.
Get started
Buy ledger paper to start or create a spreadsheet in Excel.
Before you determine your budget, figure out your income and expenditures. Then you will know how to divide up what gets paid when with each paycheck. For further guidance, seek financial counselors. Examples of budgets exist online.
By keeping track of your money, wisdom leads to savings. How do you save money?
Photo by Katie Harp on Unsplash.