Clear out the Cobwebs in Your Budget & Save More Money

Mar 18, 2019 by

With the infectious hustle and bustle of spring, you can’t help but feel inspired. Mother Nature is waking up from her season-long nap, and so are you — ready to take on the chores you’ve been ignoring all winter long. As you prepare to move through your home, dusting and mopping, don’t forget to add one more chore to your list of things to do this spring: your finances.

After a long winter which included an expensive holiday season, your budget could use a good cleaning. Here are some tips to help give your finances a good scrub, from top to bottom.

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Tidy up your budget

Your budget is a living and breathing thing that needs regular maintenance. If it’s been a while since the last time you looked at your budget, it’s time to dust it off and make sure it’s still current. Update any changes to your income (like a raise, lost job, or time on disability) as well as your expenses (like new bills or paid-off debts).

Regardless of how things change, you need to keep things balanced. Keep in mind a popular budgeting rule of thumb recommends putting away 20 percent of your income into savings, while using the remaining 80 percent on all other expenses.

Declutter expenses

If you aren’t hitting this 20 percent target, you may find it hard to grow an emergency or retirement fund. But that’s okay — all that work you’ve done to update your budget can help increase your savings.

Tracking your income and expenses accurately will help illustrate how your cash flows month-to-month, giving you insights into your financial strengths and weaknesses.

  • Strengths: You’ll probably start to see healthy patterns in your spending habits — things like paying your housing costs, utilities, and insurance premiums at the same time each month are examples of good money management.
  • Weaknesses: Some habits, on the other hand, are unhealthy — patterns revealing you pay mobile data overages every other billing cycle or that you buy a latte every day before work are wasteful.

Use your budget to identify where you’re going wrong and try to declutter or remove those expenses from your life.

Focus on unnecessary purchases like takeout and clothes first before moving onto more complicated expenses, like groceries or utilities. Although you may be able to trim the fat from these regular expenses, you can’t eliminate them as easily as you can UberEats or your Fabletics subscription box.

Spackle any holes left behind

Once you get rid of any unnecessary expenses, you’ll have more of your monthly income available to use on other things. Before you think of investing in a new smartphone or television set, consider using your newly “found” cash on an emergency fund.

An emergency fund is an essential safety net for your finances when you face a bill or repair that falls outside your normal budget.

Without this kind of savings account, you would need to take out a loan whenever a surprise bill hits. If your credit score makes it hard to find a loan with a traditional bank, online lenders make borrowing easier, regardless of your credit score. They offer online installment loans that work as stopgaps between paychecks, so you can take on important emergencies even when your emergency fund falls short.

However, nothing’s as convenient as paying off bills on your own. Like any loan, installment loans need to be repaid in full plus any accrued interest within the terms. You can click here to learn more about what those might be, but they’ll differ from lender to lender.

Compare this to withdrawing cash from your emergency fund — unless you’ve put this money in a specialized account that restricts how and when you can use it, you won’t have to pay any fees at all.

This spring, clean up your finances

Blame your soaring motivation levels on spring fever, but don’t let it go to waste. As you tackle the long list of tasks you’ve ignored during the winter, make sure you check in with your finances. A spring cleaning of your budget is the perfect litmus test to see how your finances will fare for the rest of the year — giving you the opportunity to make a seasonal change that will save more money!

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