Most people hate budgeting. It is usually quite frustrating to have to keep records, find the necessary time to build the budget and then accept the reality of the matter. Fortunately, personal budgeting does not have to be stressful or simply something you hate. There are always different alternative options that can be taken into account. This is what we will highlight some to consider.
Envelope System Budgeting
Through this you do not have to track all the money you spend. It is highly powerful and simple to manage money in effective way. The only thing is that you still need to be responsible with what you spend. You cannot double the amount you would spend on fun activities. You have to be in check.
The exact method is about the following:
- Have envelopes on hand.
- Label the envelope according to categories like clothing, eating out and entertainment.
- Put a specific amount from a paycheck inside every single one of the envelope. Try to be realistic according to the money you have at the moment.
- When the money in the envelope finishes, you need to simply stop spending on that specific category. This helps you to passively track what you spend on.
Different Account Set Ups
This is a pseudo-budgeting option that is quite easy to understand. You basically open one checking out for one category like living expenses and bills, together with those that are special for the future like the college fund. As the paycheck comes you take the same approach as with the envelope system and you divide everything into percentages in those accounts you have.
As an example, every single week you could put $30 in the vacation account. When the year ends you are faced with a higher amount that is definitely useful. A sub-account also works well to offer motivation that is sometimes necessary for some people. Then, when you find a special deal for something, like you see through the Amazon Deals Guide, you can take advantage of it and save even more.
Actively Using The Credit Card For Personal Budgeting
This is an option that is great for someone that does not have debt and that responsibly uses credit cards. The idea is that for one full month you just use the CC for every single purchase. When the month is over you print the credit card balance so you see exactly where the money went. After you notice what you spend money on you can work on minimizing the areas that are problematic. If you get the card from a suitable bank, you even receive some incentives at the end of the month so you win even more.
Rewards are very good and actually help you to easily deal with personal budgeting. These can be incredible simple like eating out on Saturdays. The idea is to reward yourself when you spend money in an effective way. If this is the case you can get the reward. If not, you will punish yourself by not eating out on the following Saturday. Just choose something cheap, affordable and that gives you personal satisfaction.