Gravity makes the earth spin, but money makes the world go round. No matter how much money we make, we always seem to need more. And if your money seems to go down the drain in ways you can’t explain, you need a few budgeting tips to help you save for future goals. Follow the tips below to transform your finances from debt to wealth:
Budget for the heck of it
Budgeting doesn’t have to be a pain in the butt. The same way you go to the gym to lose all that calories, you can budget to give yourself a healthier credit score. The critical takeaway is to see budgeting as fun. Once you see it as an enjoyable exercise, you learn to save money, protecting your financial future without feeling restricted.
Quit recurring debt
Recurring debt is a debt you pay on a monthly or weekly basis. You can’t save money when you always have a financial obligation. The best option is to pay off all your debt, starting from the most significant debt to the smallest. Once your debt is paid off, you’ll finally have money that can go into your savings.
Buy Groceries you need
Many a Canadian family gasp in shock when they find out how much of their income goes into groceries. It doesn’t take a lot of effort to walk down the shopping aisle and pick more than you budgeted for. You can cut cost on your groceries by planning your meals, and assessing your pantry to know what you have before you get what you need.
Cancel excess subscriptions
You’re likely paying for multiple sources of entertainment. There’s no need subscribing for Netflix, Hulu and Amazon Prime at the same time. Pick the one you use on the regular and cancel the rest. Movie streaming services like Netflix and Hulu allow you to view your shows from multiple screens. One of the best budgeting tips is to share a subscription with friends or family and save money while at it.
Ditch Branded Items
There’s a common belief expensive sunglasses are of higher quality than their cheap rivals because of the higher quality of the frame. It is true some brands do use premium materials; however, some expensive brand sunglasses often use the same plastic frame as the cheap ones. The bottom line is, you don’t have to spend hundreds of dollars just for the brand name, and the same goes for every other product you buy.
Budget with an App
Gone are the days when you had to budget using the excel spreadsheet. Today, there are lots of budgeting apps online that can help you save money. Apps like YNAB, Mint, and EveryDollar can help you save money. These apps integrate your financial information and transactions, allowing you to save cash without breaking a sweat.
Stick to a Budgeting System
The art of budgeting has two pathways. The former is the 50/30/20 system while the latter is the Zero-based budgeting system. The 50/30/20 system is an easy system that helps you save money by broadly categorizing your income. It separates your income into three parts; 50% for your needs, 30% for your wants while the remaining 20% goes into your savings. Although this system is easy to work with, it isn’t specific. The lack of specificity allows for laxity and cheating.
The Zero-based system is the polar opposite. It is precise. Every single dollar you earn goes to a particular purpose. Rather than clump 50% of your income into needs, you’d have to break each need into separate categories. The 50/30/20 system is one of the budgeting tips for beginners you can try. If you want something more rigid, you should opt for the Zero-based system.
Keep your Savings Separate
When you take out money from your savings account to purchase an item, not in your budget, you’re practically stealing your future. A good budgeting tip is to keep your savings account far from your routine banking transactions. That way, you can resist temptation before it arises.
Setup Emergency Funding
A lousy winter is possible where you’d have to make emergency repairs that can cost thousands of dollars. Worse still, you could lose your job. Will you dip your hands into your savings to stay afloat? No, you won’t. Your best bet is to prepare for the unexpected by setting aside emergency cash. The amount you set aside depends on how much you earn, but ensure you have enough to last you three months.
An Early Start
It’s not for nothing that the early bird catches the worm. Some of the best budgeting tips for college students tell you to start saving while you’re in school. The earlier you save, the more money you make. By the time you retire from your job, you’d be a millionaire.
Have a Retirement Goal
Since we are on the topic of retirement, an excellent budgeting tip is to sign up for the Registered Retirement Savings Plan (RRSP). It is a pension plan that gives you tax advantages that to grow your wealth. Some other pension plans you can consider are:
- Canadian Pension Plan (CPP) and Quebec Pension Plan (CPP)
- Guaranteed Income Supplement (GIS)
- Employer Pension Plans
- Old Age Security Pension (OAS)
Combine your Money
If you are a married couple, you can budget together with your spouse. You can decide to have a single spending account. Doing this will make it easier to track your expenses. You may also choose to have one spending account. Doing this will make it easier to track your expenses.
Budget for Vacation
If we are left to our own devices, we’d love to vacation in some of the most exotic places in the world. But the reality is to cut your coat according to your cloth. That means planning your holiday according to how much you can afford. You don’t need to visit the Leaning Tower of Pisa to be richer for the experience. Canada is a vast country, the fourth-largest by landmass. You can visit different parts of the country, soaking up the sights without breaking the bank.