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Have you ever been on a diet? Why? Maybe you wanted to lose weight, maybe you wanted to be healthier, maybe you just wanted to operate at the best your body could operate at. Whatever the reason, chances are you recognized that changing your diet, your plan for what you are eating, would change your life. A budget operates in the same way, for your financial life.
A lot of people balk at the idea of a budget, but really it is just a plan that details where you are and helps you get where you want to be. However, like diets, lots of people get burnt out. “I tried budgeting before.” “It’s just not for me” “I can’t do it”. These negative thoughts are extremely common – don’t feel bad – but don’t let them stop you either!
This article is going to go over how to create an effective financial diet for you, the diet that will help you get where you want to go. There are 5 essential steps to making this work.
1.Finding out where are you financially.
It’s important to know this if you’re going to be in control of your money and make it work for you and your future. That means writing down all the income and expenses you can think of for the year. Now add an extra $3000 in expenses – yep!
- Is bad debt holding you back?
I’ve got a strategy that works quickly and easily to get you bad debt free in no time! Hit your biggest and highest interest debt first with everything you’ve got. This is NOT the mortgage – these are credit cards, store cards, personal loans etc. Concentrate on the highest debt at a time and pay the minimum on all the others and extra on the main one until it is gone, then move onto the next highest.
- Conquering budgeting.
I don’t believe in making things complicated so I tend to manage to get everything I desire in an alternative way, how? Being smart and not falling for advertising gimmicks. The mantra I live by is “It’s my money and I’m not giving it away if I don’t want to” If I want something I find a cheaper or free way to get it. Maybe I’ll sell something I don’t need and buy something with the money that I do need for instance.
- The savings plan.
You might be thinking “I don’t have enough money to save any” – but after completing the last 3 sections above you might be surprised! I had a fun way for the family to save and extra $1000 last year, you might like to try this. We also cut our weekly food budget by only $20 a week and saved another $1000 in the year!
- Goal setting
When you have an idea about what it is that you do want, there are three simple steps that you need to take to set and achieve a goal.
You get out of a budget what you put into it. Financial dieting can seem painful at first, but it can literally pay off in the end by helping you to spend (and save) wisely.