A budget can function as an excellent savings and spending plan, provided you stick to it. Here’s are five tips.
Always work with cash
If you are physically paying for what you need, you’re less likely to think you have more money than you do. Using your debit card or credit card will only give you a false sense of security.
Check your receipts
Save your receipts and keep an eye on your spending patterns. Where is your money going? Did you pay more for an item this month than you did last month? Can you get that item more cheaply elsewhere. Did you buy items that weren’t budgeted for? Did you overspend?
It may sound like self-policing, but it’s the surest way to know exactly how much you’re spending on what.
If you are using debit and credit cards, keep those statements, too, to help you keep track.
Is anything missing from your budget?
Check that you’ve listed the following: car-licence renewal, TV licence, property tax, income tax, car maintenance, insurance, bond or rental payments, rates, medical aid, life cover, pension, bonus, dividends and interest, child maintenance, subscriptions, luxuries, debts to be paid, gifts, donations, holiday expenses.
Prioritise your savings
How much of your budget can you put into your savings each month? Work out the amount and stick to it. Never, ever take a short cut.
A family pact
Make sure your spouse sticks to the budget, too. Joint financial obligations can be costly if your spouse or significant other is a spendthrift. Incurring joint debt will set you back if your spouse defaults and you become liable for that debt.
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