Budgeting Tips to Help You Stay on Track

Having trouble sticking to a budget? If you’ve been trying to save more money every month or set aside funds to pay off debts, check out these tips for getting started and then staying on course:

· Be aware of where your money goes every month. Take the time to accurately track how you’re spending your funds. From major bills to minor daily expenses, costs can add up in a way that might surprise you. Once you’ve listed your expenses, you will be able to evaluate areas where you can cut back and better predict your needs in the future.

· Treat saving like another bill. In an ideal world, we advise that you save 10% of your earnings every month. However, if this proves difficult, evaluate your budget to see how much you can comfortably save after covering all necessary expenses. Treat this amount like a minimum payment and pay it diligently into your savings account every month. Having the money automatically transferred into your savings from your payroll direct deposit or checking account makes this process even easier and completely painless!

· Involve the whole family. A budget is not just the job of whoever pays the monthly bills. It is the responsibility of everyone who spends money in the household (or influences spending), so everyone should agree on goals, decide on a spending plan and be responsible for sticking to it. When everyone feels like their voices are heard and are part of a group effort to improve spending, it is easier to stay motivated and on track with the new goals.

· Small changes make a big difference. Nobody likes sacrificing luxuries, but chances are there’s something in your budget that you’re not enjoying enough to justify its cost. Think about it — just cutting a $25 weekly dinner out adds up to an extra $1,300 by year end, which could go toward savings, debt relief ... or a vacation! Other ideas? Scale down your cable or phone bill by canceling unnecessary services. Brew coffee at home instead of buying it at a java joint. Conserve energy by turning off lights and lowering the thermostat. Save gas by carpooling, biking or walking when you can.

· Save your raise. When a household’s income rises, often so does its spending. So, if you receive a raise, try to save at least half of your increase each payday, if not more. You’re not used to having that money, so you probably won’t miss it.

· After a payoff, keep paying. If you’ve paid off a debt, like a vehicle loan, consider funneling at least half of what your payment had been into an extra savings fund. Again, you aren’t likely to miss the money if you put it into savings, but if you keep it in your checking account, you’ll find a way to spend it.

· Think before you charge. While credit cards can be helpful for some purchases, an endless cycle of credit card debt can be a dangerous trap that’s preventing you from meeting your financial goals. Unless you pay off your card each month, consider restricting your credit card use. For example, don’t use it for anything you can eat, drink or wear.

If you would like help tracking expenses or want to learn more about budgeting or credit counseling, please contact Extra Credit Union's Loss Prevention Department at (586) 276-3000 to request information or visit our Personal Money Management page.

© 2010 Extra Credit Union