After reflecting on the past year, you’re probably thinking, “What can I do better, financial-wise, this new year?” or “Where did all my hard-earned money go?” (Maybe you ask yourself this every end of the month before your salary. Oops.) If so, then it’s time to do some financial self-assessment, and what better time to do it than very early in the year to get things to go smoothly for you for the rest of the year. New Year, New Budget Strategy is the new New Year, New Me.
To do a financial assessment on yourself, you need to look at your financial state and goals for the short-term and long-term. After, you can determine what budget strategy or strategies to use to accomplish your financial goals.
50/30/20 Budget Rule
This is a basic budget system if you’re just getting started to track your finance. It splits your income into 3 major groups:
- 50% for your needs/necessities such as bills, gas money, and groceries
- 30% for your wants such as travel, entertainment, your daily coffee runs
- 20% goes to your savings and debt repayments
The Envelope System
Take your budget-tracking a step further if you want to curb your spending by using the envelope system.
It’s a cash-based system where you put a limit on spending for each expense category such as food/groceries. Fill up the envelopes with the allotted cash and once you use up the money, you can’t spend more on that category for the rest of the month. This works to help you to be mindful and not overspend so that you still have some left to spend towards the end of the month.
Pay Yourself First
If you’re serious about your savings and making sure you have ample for your retirement plan, consider this reverse budget of putting money into your savings before spending on immediate expenses.
Determine how much you want to pay yourself first when receiving your salary. Whether it’s for immediately filling up your emergency fund or retirement fund.
There’s not one budget strategy that fits all and you might end up mixing strategies to suit your needs but it always helps to keep track of your budgeting.
Get a bit of help with noting down your budget planning by browsing through some of the shops below:
1. plannermarketbn
Hosts virtual planner market events that you will not want to miss out on! Keep a lookout for discounts for when they have events.
2. Dela Dean & Co.
The bio says it all: Minimal meets Chic
They’re on hiatus now but check out their Chic range of budget planners if you’re interested in the envelope system.
3. Dainty Paper Project
They make hand-stitched planners and inserts that will probably have you making an expense category of its own.