Budgeting Tips for Millennials
Budgeting is a crucial skill no matter what generation you’re a part of, but as the millennial purchasing power continues to grow, so too will the marketing efforts of big companies towards this generation, making it even more important to build good spending habits. Budgeting is crucial aspect of personal finance that everyone needs. Budgets allow people to make sure they are , and doing whatever they can to save money. If you are wondering about how best to budget, you can take many small steps.
Paying close attention to the money you earn and where it goes has many advantages. Over time, you can begin to save money and create a financial cushion to take you past any sudden cash flow problems. are an easy way of separating money that you don’t want to touch, and letting it earn some interest while it’s stashed away.
Your Basic Expenses
The first thing to think about are your basic expenses. Everyone has basic expenses they need to pay. You should know how much you’re paying for a mortgage or a rent, how much you’re paying for utilities on average each month, as well as any other kinds of expenses. This includes the food budget as well as the amount of money you’re spending on transportation costs. When it comes to transportation, make sure to include costs for public transportation as well as car loan and gas. Other costs that might be included are the amount of money you spend on all clothing items such as socks, underwear and shoes. Other expenses may include the money you pay for a child’s preschool tuition and any school lunch fees.
Keeping a Savings Diary
Figuring out exactly how much money you spend each month is easier when you take the time to keep a spending diary. A spending diary can point out precisely where you’re spending funds. Record every single thing you buy. If you purchase a cup of coffee each morning, note that fact. This is the place to make sure every single penny you choose to spend is used wisely. Ask your spouse to do the same for at least two weeks. You’ll have several weeks of data that cover the two of you and your entire spending for a crucial period of time.
One of the great things about creating a budget is that you can often spot ways that you’re spending money which do not benefit you. For example, you might realize you are on lunches, which are not only hurting your wallet, but also aren’t providing you with the high quality nutrition you need. You might also see that it makes sense to walk to work sometimes rather than driving there to save on gas and mileage. Making many small choices to save money can add up quick and create the extra cushion you need for the future.
While it’s satisfying to budget and save money, it’s also ideal to allow yourself treats now and then. Careful budgeting can create a fund that you can use for fun things. A trip to the movies and a nice date night are easier when you know you don’t to worry about the money you’re spending. The same is true when opting for a vacation. Having the money on hand and knowing where it’s are an ideal way to create a firm financial future. A thoughtful budget lets you do everything you want to do in life and achieve your long-term goals.
ContributorMiLLENNiAL is a lifestyle magazine profiling those who are shaping the world we experience. From business innovation and career strategy to sustainable health and cultural disruptors, MiLLENNiAL shines the light on the young change makers of the world.