The New Year inspires new goals including financial resolutions.
The holidays can be a challenging time to save money, and now you may be motivated to regain control of your spending habits. However, saving, reallocating funds, and budgeting can be overwhelming tasks requiring attention to detail and time. The good news is that there are methods to simplify the process.
Budgets don’t have to be restrictive. In fact, a budget is simply an organizational tool that can help you keep track of income and expenses. With increased awareness, a budget can help you determine the best way to allocate your money. Overall, a budget can help you get “financially fit.” This means effectively managing your money to meet short-term and long-term goals.
So, instead of letting money management overwhelm you, here are a few ways to rethink the budgeting process.
First, pay yourself! A rewarding budgeting method is to “pay yourself first.” This means putting a set amount of money from each paycheck into savings or investment portfolios before spending anything. Organizing the remainder of your income is simplified and reduces the temptation to overspend on things you may regret. Paying yourself first streamlines goals, and for some, this can be done automatically through an electronic bank withdrawal system to make saving mindless.
Another key step to building a budget is to get organized. Keep track of bills to quantify expenses and get a realistic picture of how you spend money. To do this, carry a notebook to record all transactions for at least a week. This will increase awareness of your spending habits and help you understand where you currently allocate your money.
Once you have a better grasp of your financial habits, you can build a realistic budget. A realistic budget is a plan that accurately reflects your income, needs, and wants for your current
life circumstances. Following this type of plan will help you to find balance, and empower you to improve your financial situation.
If you want to discover more about your spending habits and how to construct a budget, join the Cottonwood Extension District on January 16th. This Personal Finance Workshop will take place at 10 am at Great Bend Public Library. Contact Karissa at 620-793-1910 to learn more.
Karissa Winkel is the Family and Community Wellness Agent with K-State Research and Extension – Cottonwood District. You may reach her at: 620-793-1910 or [email protected]. K-State Research & Extension is an equal opportunity provider and employer.