If you have a hard time sticking to your budget, you’ve come to the right place. Financial Educator Marsha Barnes sat down with Black Enterprise to give us some budgeting advice. Here are her top budgeting tips:
1.) Commit to proper money management. Living within your means is not a one-time thing or something you do until you have a saved a certain amount of money. It should become a habit and a part of your lifestyle. Understand that living within your means not only puts you on the road to financial health, but also gives you peace of mind and allows you to make long-term future plans.
2.) Put away money for retirement: Try to contribute the maximum amount to your 401(k). Understand that a financial plan always consists of emergency savings first, then retirement savings. The next step is everyday living: groceries, utility bills, car notes, lunch.
3.) Set a weekly budget meeting with yourself. Set a regular time to go over your finances and make sure everything is in shape.
4.) Identify what you are currently spending your money on. Know where your money is going. Track each purchase in a note book that you carry around with you. Also keep receipts from every purchases.
5.) Know what your actual income is. Understand what you are actually bringing home– how much money is coming in how much is going out– because that is the actual amount you have to work with.
6.) Treat yourself as a debt that you owe. Pay yourself first. Make sure you have set automatic savings accounts deposits, that all insurance policies are appropriate, and that you are on track with your retirement goals.
7.) Set monthly bite-size goals. Set savings goals or debt-elimination goals every month. Even if you have to start with $20, do it.
8.) Focus on an emergency fund. This cannot be an option. If you lose your job, fall ill, or need costly repairs to your home or car, an emergency fund will be there to help cover those expenses and can prevent you from having to go into debt from credit cards or taking out a loan.
Additional reporting by Sheiresa Ngo
Stay tuned for the fourth and final part of Marsha’s story, where she will share some of her top savings tips. Read part two here.