6 Smart Budgeting Tips People Unfortunately Ignore

The internet offers no shortage of blogs about personal finance. These websites address anything and everything somebody would want to know related to making, spending, and saving their money. However, when someone isn’t up to speed with the depth of the discussion in the personal-finance world, the array of advice can overwhelm.

If you’re looking for smart budgeting tips but don’t want to go down a rabbit hole, I have six for you: 

Eliminate High-Interest Debt

Perhaps the most important part of budgeting is knowing how much bad debt you have and prioritizing the repayment of it. The debt avalanche strategy focuses on paying off the highest-interest balance before any other debt while a debt snowball plan aims to build morale by paying off the lowest overall balance first.

Debt consolidation options like obtaining a personal loan or getting a balance transfer might make sense depending on the terms you receive and the current interest rates you’re carrying across balances.

If your debt is already in collections, then you might be able to settle it for a percentage of its original amount. You can try to negotiate with your creditors on your own or seek the help of a debt settlement provider.

Actively Use an App for Budgeting

Technology and financial tools are not a new relationship. From tried-and-true tools like Mint and YouNeedaBudget to budget apps that leverage artificial intelligence like Clarity Money, many choices exist. What matters most though is choosing something, then sticking to it. These tools all can provide the needed solution, but success hinges on an individual’s commitment. 

If you really want to stay on top of your finances, set your budget based on the actual month’s forecasted expenses. After all, our spending requirements aren’t fixed. They change based on holidays, vacations, and personal life events among other irregular costs.

Focus on Curbing Your Worst Spending Habits

Many people start with earnest ambitions when they set their budgets only to quickly gloss over the reason they need to restrict their spending.

The first step to cutting down on excessive spending is to recognize and accept your weaknesses. When you know the beast, you can avoid becoming that beast.

Prepare Simple Meals

It’s no secret that eating out is more expensive than eating in, but sometimes we fail when we try to put that to the test. Maybe we aim too high on a meal and waste money on an unfulfilled recipe as a result. Perhaps we’re not organized with what we want to make and spend extra hours wandering the grocery store in confusion.

What if you started with simple concoctions you know you enjoy, and go from there? There’s nothing time-consuming or skill-dependent about making delicious flatbread sandwiches with turkey, tomato, spinach and olive oil or packing snacks like carrots, peppers and cucumbers with hummus.

If you really feel lazy, peanut butter and a little honey is a wonderful complement for whole wheat bread and bananas to hearty oatmeal. What are your favorite ingredients? Make simple meals and portion out snacks in bulk ahead of time to slash a significant percentage off your monthly food bill

Automate Your Bill Pay

Living debt-free is a beautiful thing. What’s even better is having a strong credit score to match your clean balance sheet. An easy way to keep things this way is to automate any monthly payments you have to make, such as utility bills, rent payments, and insurance payments.

However, this also applies to savings and retirement contributions. Allocate any extra room in your budget to yourself and watch your net-worth climb. 

Cherish the Wins Along the Way

Both the beauty and torment of paying more attention to our spending are accepting the ebbs and flows that come with budgeting. We won’t always stay within every spending limit, and that’s OK. That’s not what budgeting is about. The goal shouldn’t be to deprive ourselves and live miserable existences.

Instead, it should be to develop a healthy relationship with money so that it serves our lives and not the other way around.

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