Smart Budgeting

There are a lot of ways to budget your paychecks. Although the goal is to simply spend less than you earn, life usually doesn’t work that way. Some expenses pop up when you least expect it. When money gets tight, or when you are saving towards a goal, these five steps could help you stay organized and disciplined with your finances:

1. Understand your monthly income and expenses.Keep a written record for a few months just to be sure you don’t miss a single expense. When you know where all of your money goes, you can get a baseline established.
2. Set up SMART goals. SMART stands for Specific, Measurable, Achievable, Relevant and Time-bound. This means you write down (or type) specific goals that are measurable, achievable (very important), and relevant to your budget and needs. Then give yourself a deadline to achieve those goals. You might even tell a friend or family member about your SMART goals to keep yourself accountable.
3. Make a plan. Be sure to account for debt repayment. You want to pay more than the minimum to pay off those debts faster.
4. Maintain a savings account. Saving money is just as important as paying down debt. With a savings account, you can have cash on hand for unexpected expenses instead of having to use a credit card. Move some money into your savings account on pay day before you are tempted to use it. Start small, with an amount that is comfortable, and see if you can increase it over time.
5. Evaluate your spending and debt payments. Adjust as needed to meet your SMART goals. If you want to pay off a loan faster, try to spend less overall and put more toward your goal.

When you’re ready to start making a plan, check out First Tech’s checking and savings accounts that can help you budget for a better future.