Financial Literacy Budgeting for beginners
January 21, 2019
Budgeting can be tough, especially if you’re a beginner, which is why we’re here to help. And we’re not gonna lie to you either… budgeting isn’t the most thrilling of topics, but that’s why acronyms were invented.
B – Beware of overspending
Before the budgeting process can begin, you may need to take a good hard look at some of your ‘not so admirable’ spending habits. Thinking about how you can cut down on unnecessary spending (like online shopping, your morning coffee, or expensive lunch outings), understanding the root of the problem, and vowing to make a change is an important first step.
U – Understand the basics
If you’re a beginner at budgeting, the 50/30/20 method is a good place to start out. Fifty percent of your after-tax income should be spent on basics like food, housing, transportation, and bills, 30% on your wants, and 20% on savings. We like this method because it allows room for you to have FUN, which is just as important as saving.
D – Do it together
For better or for worse, right? If you’re married, budgeting should be a two way street, and you both need to be on the same page about money and spending. If you’re single, having someone around to keep you accountable isn’t a bad idea either.
G – Get help
Asking for help isn’t a sign of weakness, but a sign of strength! A considerable part of budgeting is saving, and that’s right up our alley! Whether you take advantage of a TFSA, our current term special (29 months @ 3.25%* and 41 months at 3.40%*), or our wealth management team, help is just a phone call (or text!) away. Get in touch today.
E – Excel is your friend
A quick Google search on budgeting will lead you to excel sheets galore. These templates are usually pretty user friendly and will help you visually see your income, spending habits, and savings all in one convenient place.
T – Timing is key
Falling behind on creating a monthly budget will only lead to inconsistencies in your spending, causing to fall behind in your saving. It’s important to create your budget (and completely understand it) BEFORE the month ends. This is an extremely important habit to get into and one we can’t stress enough.
*Rate subject to change.
