Does it seem like your paycheck is spent before it even comes in, leaving you with very little money left over for anything else? If so, you’re not alone. According to a 2015 survey, 76 million Americans say that they are struggling financially; in fact, they’re hardly able to make ends meet. While the percentage is actually lower than it was in 2013, when it was 38 percent, it’s still alarmingly high.
There’s a factor that so many people who are struggling financially have in common: budgeting, or rather, the lack of budgeting. By establishing a budget, you can establish a spending plan, and in doing so, you can better manage your money and actually have some left over in your paycheck. By making some simple changes, you can establish a budget and actually sock some money away. Here are some tips that you can use to get your finances on track and escape the hardships that have been weighing you down.
Analyze Your Spending Habits
The first thing you need to do is assess your spending. Once you know where your money is going, you can then come up with a plan of action to create a budget. Create a list of all of your expenses and calculate how much you’re spending. Compare the amount you come up with the amount you take home. From there, you can move onto the next step…
Prioritize Your Spending
Once you know what you’re spending your money on, you can start prioritizing your spending. Determine what absolutely need and what you can cut back on. For example, mortgage/rent, utilities, and transportation are essential expenses; but, going out to dinner, going to the movies, hitting the bar, and shopping for new clothing on a regular basis aren’t essentials. But cutting back on those non-essentials, you can save a substantial amount of money and will be able to better allocate your funds to the necessary expenses.
Make Changes to Your Essential Expenses
Making changes to your essential expenses will allow you to hold onto more of your hard-earned cash. While you can’t do without car insurance, you can make changes to your plan. For instance, if you have full-coverage and you don’t need it, consider cutting back to just liability; doing so could save you a pretty big chunk of change. You can make changes to several of those essential expenses; see if you can refinance your mortgage, change your cell phone plan, or up the deductible on your health insurance so you’re paying less on your monthly premiums. These small changes can amount to a lot of money; money that you can spend on other things – or better yet, put into savings!
Automate Your Savings
Pulling money out of your paycheck and putting it into savings can seem virtually impossible. Automating your savings may be the perfect solution. Every month, a certain amount (that you set) will automatically be pulled out of your checking account and put into your savings account. For example, you could choose to have $25 automatically transferred from one account to the other; it’s not enough to really impact day-to-day spending, but over the course of a year, you’ll have an extra $300 in your savings account.
Summing It Up
With these simple strategies – and by making a few adjustments – you can create a realistic budget and get yourself out of financial hardship. Also, remember that if you’re in a bind financially, you can always rely on a payday loan from the Personal Money Network, one of the most reputable financers of fast, short-term personal loans.