4 Ways You Know You’re Good at Budgeting

Apr 26

4 Ways You Know You’re Good at Budgeting

Budgeting is a skill that takes time and practice to master. This is because you can’t just print a budget off the Internet, implement it into your life, and have it work perfectly for you. You have to analyze your financial situation and needs and tailor-make a budget that works for you and your family. Some people can do this in a month while others need a year or more to perfect their budget. Plus, the budget has to change based on changes that happen in your life. So, take a look at these three ways you know your budgeting skills have been mastered.

Your Savings Account Is Consistently Growing

3.1

Image via Flickr by kenteegardin

According to CNN Money, 28 percent of Americans don’t have any emergency savings. The reason for this is different for all of these people, but a common problem is overspending. Rule number one of budgeting is to never spend more money than you make. So, if your savings account is always growing (even by a little bit) you know you’re getting good at budgeting. To help you get better at spending less money than you make, you can go for a couple months only buying things with cash instead of a credit or debit card — it will help you better see where your money is going and how much you have left.

You Base Your Purchasing Decisions on “Needs” and “Wants”

3.2

Image via Flickr by 生活童話

People start budgeting better once they realize the difference between a “need” and “want.” It’s not a clear-cut rule, but there really are only three needs — food, clothing, and shelter; everything else is a want. However, just because something is a need doesn’t mean you have to spend a lot of money on it. For instance, many Americans participate in the Friday night pizza phenomenon. They think they need to eat pizza on Friday, when the truth is that they just want to eat pizza on Friday. They’d save a lot of money by not buying pizza that frequently. The need is food, not pizza.

You Don’t Pay Full Price for Anything

3.3

Image via Flickr by the justified sinner

Almost everything goes on sale, so you can save money in your budget by waiting to buy those “wants” until they aren’t full price. Shopping at thrift stores is another great way to keep your budget on track. Additionally, you should shop around before making a purchase — the Internet makes this so easy to do. For instance, everyone knows that all car dealerships have different car prices, even the MINI Dealers Baltimore has to offer. So, you should shop around for the best car price before going in to make a purchase. You should take this same bit of advice to heart in all of the purchases you make.

Are you good at budgeting? We’d like to know what you do to stay on budget and how it has evolved over the years. Leave a comment below.