Feeling Lost? The Six Simplest Tips on How to Make a Household Budget

how to make a household budgetLearning how to make a budget can seem overwhelming, but once you master the basics, you’ll never find yourself in a financial pickle again. You also won’t feel like your time at work is wasted. Every minute you invest in the art of balancing your personal books is worth it. The relief alone is enough to motivate even the sloppiest of spenders, so get started sooner than later.

Balancing your budget begins with these six simple tasks:

  1. Get everyone involved in the discussion. The Penny Hoarder gives excellent advice to couples, who need a budget to prevent finances from becoming a problem down the road. While talking about the budget can seem boring, it can also introduce ideas, goals and aspirations you never knew about one another—or yourself.
  1. Count up all of your income. With as many avenues for income that we often have going at once, it can be easy to forget a resource or two if you just focus on paychecks. While regular, salary pay is generally reliable, you can earn money in many ways, from taking back pop cans to babysitting on the weekends to officiating wedding ceremonies for extra cash. Make sure you count up every cent, because, as they say, “money has a way of spending itself,” so it’s important to have a purpose for every cent.
  1. Figure out your necessities. Shelter, utilities, groceries, monthly payments for student loans or insurance policies, gifts for upcoming birthdays or holidays, house supplies and things needed for school or work all fall under “necessities.” These are the things you cannot do without, or will not feel good about yourself if you go without, and they may include contributions to a retirement fund or savings toward a vacation or a new car or house. Simply put, these costs cover your needs and obligations.
  1. Consider what’s leftover and what you’d like to do with it. First and foremost, a small amount of money should be allocated to an “allowance” fund for everyone in the family. This should be money they can spend freely without having to justify or explain. It’s important for everyone to have at least a little fun money, even if it’s only $10 a paycheck. Then consider your bigger objectives in life. Some will be immediate—like wanting to see the newest Neill Blomkamp movie—while others will be further off. Whatever they are, earmark funds for them now so you can follow through later on.
  1. Figure out where your money is currently going. Cell phones and other smart devices have revolutionized the way people budget, especially when it comes to tracking spending. These days, you can take a photo of your receipt, and your budgeting app will sort your purchases into categories like “Personal Care” and “Cleaning Supplies” on your behalf. These entries can be edited, just in case they’re wrong. Once collected, the information is shared in effective ways that help you make the choices needed to cut back on unnecessary bills.
  1. Commit to making changes. Once you realize you’re blowing your budget on morning coffees, it’s easy to say, “I’ll treat myself once a week, and save the rest of that money for a trip home for the holidays.” Making careful choices about your spending may feel uncomfortable for a month or more, but keep trying. Over time, you’ll notice the ends meeting more often, leaving more room for extras you feel are truly important.

Even if you’re working to make a budget, you may need a title pawn to help you in the meantime. Click this link to locate your nearest Title Tree, and we can help you get the cash you need as well as the assistance you need to learn how to make a household budget.