How to budget, save and avoid spending traps
Are you working a full-time job but thinking about returning to school so you can change careers? Are you in the midst of your training program and only working part-time or not at all so you can focus on studying? Do you consistently follow a budget, but just veered off track with spending recently? Have you been wanting to save money, but just didn’t know where to start? Read on to learn some basic budgeting facts and savings tips that can help you manage your monthly finances while still being able to have some fun along the way.
Budgeting can be fun
Maybe you’re a numbers person and have always thought budgeting was fun, and even easy, to do. Maybe you feel overwhelmed every time you hear the word budget, and just want to run and hide from it. If you fall into the “budgeting is fun” category, we applaud you! You might want to consider helping out a friend or family member who doesn’t share your enthusiasm!
If you fall under the “overwhelmed” category, don’t worry. You’re not alone. But, with a little time and research, you can set up a budget that can be easy to follow from month to month. And once you do, you might feel empowered by your new knowledge and glad that you know where your money is and where it is going each month.
If your head is still swimming, you might want to consider starting by printing out this budget worksheet to get you started on the path of tracking your monthly income and expenses in one place. You can also find more suggestions the saving and investing page of www.usa.gov, including a video on how to build a budget.
If you are someone who loves working in spreadsheets, you could create one for your budget that tracks your income and monthly expenses, such as rent, utilities, car payment, gas, insurance, food, transportation expenses (trains or buses if you don’t own a car), entertainment (eating out, movies, concerts), etc.
Some people like keeping track of their budget in a simply worksheet or spreadsheet like we just discussed. But, if you are someone who prefers to put the power of technology to work for you, there are definitely many options available to you. A quick Google search on “personal budget programs” can definitely point you in the direction of some research. While ACMC doesn’t endorse a particular model or method, this recent NerdWallet article could also be a good place to start your search for just the right tool for you.
Monthly vs. mid-range vs. long-term goals
You might still be in school or just starting out in your first job, but it’s never too early to plan for your future. Of course, you’ll always have daily living expenses to cover, but maybe you would love to take a vacation next summer. Or you’re looking ahead to possibly purchasing a house. Looking even farther into the future, you may want to start saving for retirement. Including these in your monthly budgeting decisions, even in small amounts, can help move you ahead toward those goals.
Tips for saving
Once you’ve spent the time really looking at you monthly costs and income, you can then set your sights on ways to make your paycheck last longer. Here are some tips to consider.
- Use credit cards mindfully. Pay attention to each time you swipe your card. Purchases can add up quickly. Keeping a close eye on your credit card spending can help ensure you’ll be able to pay the balance in full each month to avoid interest fees or getting into deep credit card debt.
- Helpful tips from AmericaSaves include waiting 24-hours before making a large or non-essential purchase to give yourself time to consider whether it is the best decision to make, and unsubscribing from marketing emails so you aren’t tempted to purchase something unnecessary just because you received a discount email offer.
- Become a comparison shopper – for small (groceries) and large (electronics and appliances) items.
- Create a weekly grocery list and stick to it while you are in the store. (Helpful hint – don’t shop when you’re hungry!)
- Plan ahead and pack your daily lunches rather than grabbing something on the go.
- Limit the number of times you dine out. This includes stops at coffee shops and fast-food drive-through windows.
- Sales and discounts can be your friend, but don’t just buy because something is on sale. Consider if it is an item you really need.
- Borrow books and movies from the library rather than buying them.
- Keep an eye out for specials. Many restaurants run specials like 50 cent wing nights. Some movie theaters offer $5 ticket days.
- Instead of going to the movies, host a movie night with your friends at your home. Take turns hosting. Be sure to remember the popcorn, soda, and candy! (Buy in bulk or at a dollar store.)
- Rent textbooks rather than purchase them. Or, if you have to buy, and it’s not a book that you can use as a reference in the future, sell it at the end of the course.
- Always ask if a place of business offers student discounts and take advantage of them if you have a valid student ID. Ask at places like restaurants, gyms, hair salons, etc.
If this article has made you excited about learning more about budgeting and saving money and you love listening to podcasts, you might want to check out the FDIC’s Money Smart to learn more about how you can manage your financial life.
Getting started with a budgeting system might seem a bit daunting, but once you have a budget to follow, you might actually find it will help you be less stressed on a daily basis as you make spending decisions. You might also find you want to continue to learn more about saving, not just for recurring bills, but for a vacation, new car, or farther in the future, retirement!
This article is part of the weekly blog of the American College for Medical Careers in Orlando, FL. For more about our professional training programs,