Are you a person who shudders at the thought of a budget? Do you know when bills are due, or the exact amount that is in your bank account right now? Well, if you struggled to answer those questions, then read on to learn six simple ways to change your budgeting mindset and see success in your finances.
1. Track your spending!
No one likes to track their spending, but it is so important if you want to get ahead. In tracking your spending you can see where you might be going wrong and where you can trim the fat. You can use spreadsheets to track your spending, or make the investment in a tracking app like Mint or YNAB. Seeing your spending for the first time in black and white can be distressing for some, so make sure you alert your support system to your plans so you can reach out if the process becomes stressful.
2. Set long, and short-term goals
You have to look to the future as well as the present if you want to change your budgeting mindset. You should focus on setting small short-term goals to foster and encourage your new mindset. In the short term, you could save for a weekend getaway and in the long term you could set some goals for retirement. Goals are a great motivator and can help you switch your mindset for success in your financial health.
3. Be willing to sacrifice
Success and sacrifice are hand in hand when it comes to financial success. There are many things you know can be cut from your budget, but humans are creatures of habit, which is why it is often difficult to change their mindset. You can sacrifice and still have what you want. For example, if you spend $40 a month on coffees, why not invest in a fancy coffee maker, or K-cups? You can still have the fancy coffee, but at a cheaper rate.
4. Know what is due when
Many Americans tend to forget basic bills such as the water or gas bill. As such, many disconnections happen. If you want to run a tight ship, then you need to know when everything is due, and budget to make sure all bills are paid on time to avoid late fees.
5. If you don’t have a budget, make one
It may interest you to know that only one third of Americans have a budget that is used and maintained. Without a budget you have no chance of attaining the goal of financial success. Make a budget review it regularly and stick with it!
6. Hire a professional
The process of financial success can be stressful and in truth there are many people out there who are not equipped to deal with finances. As such, if you find that you are one of these people, why not hire a financial planner? Financial planners can tailor a budget to meet your needs and they are not afraid to tell you where you are going wrong, while making a plan to help you fix your spending mistakes.
The process you are about to embark on is not going to be easy. There will be many sacrifices and a lot of frank discussions. But all of it is necessary if you plan on having a healthy financial life and bright outlook for the future as well as retirement.