By Tua | July 12, 2017
We know—budgets are kind of a pain (most Canadians don’t bother). Maybe you’re afraid you won’t have fun anymore! But thoughtfully prepared and honest budgets can help keep you from overspending and falling into debt. Student loans and recessionary job markets can be managed with a little planning and subtle lifestyle choices. And keeping to a budget can make all the difference. It will help you understand priorities, like would you rather have a latté every day? Or a vacation every year?
But maybe you don’t know where to start. Tua can show you how!
Most people require about 3-6 months of emergency funds. A sudden job layoff, for example, is the perfect reason for it. People’s living arrangements are different, but the basic breakdown should be 50% for living expenses, 20% divided in half among savings (10%), emergency funds and paying debt (10%), and 30% toward entertainment, potential travel, and all the things that make life worth living.
Add up all your money coming in and subtract from it all your guaranteed expenses for each month (rent, utilities, transportation, and groceries). This is discretionary money not already spoken for every month. A budget will finally answer the question, “where does the money go?” How many times do you eat out or have drinks with friends? Perhaps your clothing budget could use a trim. Or maybe, there are things we can live without, like magazine subscriptions, a daily coffee, or cable TV. Then again, you may also conclude you just need a better paying job. Speaking of which…
…an immediate way to solve cash flow issues. Those needing extra to cover expenses can check their networks and see what’s happening out there in the job market. Live in LittleTown, Canada? Might be time to move to a bigger city for more opportunity. On the other hand, if you live in a costly urban centre, it might be time to move to a less expensive area of town. Or if you’re employed and see possibility for upward mobility, try to become an obvious candidate for promotion.
Being organized isn’t hard. A few handy apps can really help make the difference:
Mint: Links bank, credit card, loans, and investment accounts to track them at once. Set up a detailed budget with specific categories and receive alerts for bills as they come due, or when account balances dip.
LearnVest: App links to accounts and files purchases into category folders. You can also get access to a wealth of relevant articles and info, particularly helpful to personal finance newbies.
Level Money: This app is fairly simple: it lets one know how much available cash they’ve got for the day, the week and the entire month.
Plus, when you pair these handy apps with our debt consolidation loan you can make one simple payment. In other words, instead of tracking many debt responsibilities, you can simplify it with Tua!
Don’t just make plans—put them into action, and then make them a habit. Write goals down because it makes them more real. Find out your credit score and pay bills on time while keeping an eye on your credit. Set up some accounts for automatic withdrawals. This makes it easier to save or invest your money, because you won’t even miss the money (aim for 10% of income). Got a little extra, like a bonus or tax return? Consider using it to pay down debt or investing.
And finally, don’t be so hard on yourself. If you make mistakes along the way you can always get back on track. Those with budgets will still be further ahead than most Canadians who have no plan at all. Remember, Tua is here to make your budgeting easier and to help you reach your true potential.