To effectively reach goals in life, you must first map out a clear plan of action. A personal or family budget goal is no exception. To attain a desired goal, such as purchasing a new car, home or living debt-free, you’ll need a plan to follow so you can reach your goal on budgeting. Follow these tips to get started towards effectively setting and following a plan that will lead to your goal on budgeting.
Start your goal-setting with a family meeting. Gather the family together and discuss how much money comes into the household and how much goes out on a weekly or monthly basis (if you live alone or if this is a personal budget, gather your check stubs and bill receipts). Then brain-storm for ideas on ways to increase income and decrease spending. Even the youngest members of the family should be involved in this start-up process so they can begin to learn the value of a dollar.
Make a Plan
After discussing expenditures, like food and energy costs, make a plan of action on how to cuts those costs. Setting a generic goal like ‘cut down monthly grocery bill’ will not help you effectively follow a budget. The plan must be concise and doable (if the money-saving steps are too difficult, no one will follow them). For example, set a goal of eating out one less time each week by cooking an inexpensive family meal to take its place, or opt to have a ‘meatless Monday’ to save a few dollars on the monthly grocery bill. Each dollar that is saved by making a plan and working the plan should go into a special savings account and spent only towards the agreed upon budget goal.
Have a Goal
Why do you want live by a budget? A clear, desirable and attainable goal will help you stick to a budget when you get the urge to splurge. That goal can be anything you and your family agree upon, such as braces for little Johnny, a family vacation to Walt Disney World or to be debt-free in five years. Keeping your eyes on that goal will help you stick with it when the going gets tough.
Make Saving Fun
A little family competition will make saving money fun and increase the savings. Play games to see who can save the most money each week or who had the best idea to increase household income. Compare notes once a week and give kids non-monetary rewards for turning out lights, turning off water and packing their school lunches, all of which will save money.
Limit impulse purchases by setting a limit on the amount of money which can be spent without consulting your partner. If you have to stop and take time to discuss buying a pair of $150 pair of shoes with someone before you buy them, odds are you won’t make the purchase unless they are absolutely needed. The spending limit can be as low as $20, make the limit comfortable and doable so it will help you effectively follow your goal on budgeting.
Author Pam Johnson is very money conscious. She is currently going back to school for her MBA online and doing in affordably. She is a contributing author for affordable mba programs