5 Smart Strategies to Manage Your Budget + Budget Tracker Update

Hello beautiful people and happy Friday!

We know how hard it is to budget. Once we hit our 20's, we begin a stage in our lives where all of a sudden, we’re juggling a hundred different things while having to be money-wise. One thing we're trying to navigate through is money management. To some people, talking about their finances may be a very uncomfortable reality to face, the numbers and planning may seem intimidating, but it’s an important subject to discuss. More often than not, we’re thrown into the world with limited knowledge about finances. But here’s the thing, most (if not all) of us are experiencing that. So, today, we'd like to give you a little bit more insight into managing your finances and how we can figure it out together (because we don’t have it 100% figured out, too).

If you’ve been following us, we’ve posted a FREE BUDGET TRACKER, click here to get your own copy or fill out the form down below. In today’s post, we’ll show you how to fill it in and what you can do with that information.

Here’s a helpful tip: Before filling anything into your tracker, open up all your accounts and list down any income, savings, bills and expenses that you have. This will make it easier for you to fill out your tracker.

Make sure to compile your monthly trackers in a folder or envelope so you can see your progress.

Filling out the tracker is only the first step in budgeting. Now that you have all that information in one place, it’s time to put it to good use. These tips are easy and straightforward, so you can kickstart your budgeting and debt-free journey. Here’s a list of questions you might be asking yourself after filling out your tracker:

1. How much am I saving every month?

First things first. PUT ASIDE MONEY TO SAVE BEFORE PAYING ANY BILLS/EXPENSES. This might sound counter-intuitive, but it’s the first step that most financial advisors recommend. Why? Because you’ll be so focused on paying everything else, and almost usually, you forget to set aside money for yourself. ALWAYS PAY YOURSELF FIRST. We recommend saving 10% of your income (2% for insurance, 8% for personal savings). If you’re struggling to save money, do this step and you’ll be golden!

2. I have irregular income. How do I even start a budget with that?

This ties in with the first tip. When you pay yourself first, you allow yourself to build some emergency funds. Before you save for anything else, make sure you save enough money to cover expenses for 3-6 months. If that sounds too heavy for you right now (which is totally normal), set a goal to have an emergency fund of at least $1000 in your account. This will help cover you in case your income isn’t as much as you’d expected, or if an emergency comes up.

3. My expenses vary per month. How can I anticipate that for the coming month?

This is where regularly filling out the tracker can really help. Managing money will always be a work in progress. No matter how good you are at budgeting, it will always be a work-in- progress. So, don’t feel bad if you feel like you haven’t figured it out or don’t have it together.

So, there’s two kinds of expenses-fixed (recurring monthly bills) and variable (clothes, food, entertainment, etc.) expenses. For fixed expenses, it’s usually the same amount every month, which you can anticipate very easily. It’s your rent, car payments, utilities, etc. For variable expenses, it’s your random and varied expenses. It’s not always the same amount every month. You might be going out a lot this month, but not the following month. This is where people have a hard time anticipating their budget. If it helps, you can split your variable expenses into different categories like food or entertainment, so you know how much money you’re spending on specific categories. From there, you’ll be able to see approximately how much you need to set aside for these expenses. Doing this will also help you determine unnecessary expenses. Cutting out unnecessary expenses will definitely help you stick to your budget, and you’ll be able to put that extra amount into your savings instead.

4. Why do I need to fill out my goals if I’m just saving anyways? Can I just put that all under savings?

Technically, yes you can. However, the purpose of the goals table is to visually see and keep track of things that you want to save for. Say you’re saving for a new laptop, you’ll be able to see how much you need in total and how much you'll need to save every month. It’s a helpful way for you to keep track. Of course, if you’re saving for something specific, you’ll need to put aside extra $$ for it, on top of your regular monthly savings (emergency fund).

5. What do I do with the net income? Is it even relevant?

Yes , it is relevant. It’ll show you if you’ve been spending more than you’re earning. If your net income is negative, it’s a sure sign that you might need to change things up a bit, maybe get rid of some unnecessary spending in the following month. If your net income is positive, it means you’ve been living within your budget, which is great! With that amount, you can definitely put that towards your savings.

We've filled out a sample tracker for you to refer to if you need help filling out your sheets. Please note that the amounts listed on this example do not reflect real examples, but we will be showing you a version of how we use the tracker for personal use soon!

We're aware that this post is definitely a lot to process! It took me a lot of brain cells to write that up if we’re being honest lol. It’s overwhelming, but just take it one step a time. Having this tracker doesn’t mean you’ll be able to figure out your finances right away. It takes time, but this is a very helpful tool for you to keep track of how much money is coming in and out. Again, it will always be a work in progress. So, don’t be too hard on yourself. Feel free to bookmark our post, so you can reference back to it if you’re struggling to fill it out. As always, our email is open for any questions.

We hope that our post is informative and will help you kickstart your budgeting journey! We’re in this together, so don’t be afraid to start! We’ll be back again with another #FinanceFriday next month. So, if you have any questions or topics you’d like us to cover, let us know! We’ll check back on you again next month for another #FinanceFriday!

Good luck,