Secrets of Personal Budget Management

Managing a personal budget isn’t easy as there are just so many tantalizing items out there that have to be bought right away. Of course, this is not the case and most things that people buy don’t have to be bought. It can be hard to control these urges, but through a personal budget, as well as the proper management of it, then pennies can be saved and a significant amount of money can be put away for a rainy day. Budget management is a great problem for many people and it even worth being written about in some custom essay or research paper.

Budget Management

Actually Creating a Budget

The problem that many people encounter when trying to curb their wasteful spending is that they don’t have a budget to begin with. Arrogance when it comes to making a budget often stands in the way of it as people tend to believe that they can handle everything themselves without any problems. Once it goes wrong that’s when people start to make budgets. Start early and stay clear of the problems.

Begin by looking at exactly what’s coming in on a monthly basis. It’s unwise to use the yearly figures as these can change and throw any budget out of its correct orientation. Once the amount that’s coming into a household every month has been found then look at the amount that’s going out. On a side note, remember to take into account any tax or insurance contributions.

Personal Budget Management

The hardest part is figuring out every single expense out there. Start with the easy ones. Look at the bills that go out every month. Grab the latest statement for a mobile phone contract, electric, gas, water, and the Internet. Add all of these up and that can form the initial outgoings.

When it comes to the food bill a rough estimate is usually required as not everybody purchases the same things every week. Take the latest receipt and add a little extra on to it to cover for those treats and other rare culinary delights.

Whatever is left over is what people have to play with every month before they start going into debt.


Everybody needs some cash reserves to cover any emergencies. Anybody in any job could lose everything in the space of 24 hours. Failure to have any savings is going to mean that poverty, and even starvation, becomes a very real possibility.

The best way to handle this is to pay out roughly 5-10% of each month’s salary to a savings account. In fact, it’s often better to deduct this prior to paying any bills because if any minor hardship commences then it will be the savings fund that doesn’t make it to the bank. If it’s deducted and deposited before anything can be spent then this money is guaranteed every month.


Spending money is the key to making money. Higher risks will yield greater rewards, and that’s why investing should be a part of anybody’s personal budget management. Cut down on the disposable income and put the money into something. For some people it can be as risky as the stock market and for others it can be as simple as spread betting for minor gains. The choice is really up to the individual and what they feel comfortable with.

Insurance Review

It’s amazing just how many people spend too much on insurance. There are always risks, but it’s all about taking calculated risks to make money. The fact of the matter is that if all the headlines are to be believed then going without any of the insurance policies in existence would be essentially preparing for disaster. Take a look at the amount of money that’s been spent on insurance and cut the policies that are not directly relevant. Having cover for a flood in an area that hasn’t had a flood in over a century is not a good idea. Cut it out and invest the money elsewhere.

Pay Cash

For those irregular expenses keep a suitable amount of cash in a wallet. It’s a well-known fact that people are less inclined to part with their cash than they are to simply swipe a credit card through a machine. Utilising symbolism in this way is a devastating way to stamp down on those impulse expenses that work to ruin any good budget.

Money Management on a Tight Budget

Leading your life on a tight budget and trying your level best to save some money for the future might actually be a hard task for you. There are a lot of people, who will tell you to start investing for securing your future needs, but none of them would show you the right path.
The good news is that, the amount you can save for meeting your future needs does not depend upon your income. It is all about figuring out some unique ways for cutting short the expenditure habits.
You just need to follow these simple but amazing ways, which would create opportunities for you to indulge in the process of savings.
Tips for Managing Money on a Tight Budget

Spending Cuts:

One of the most effective ways for making your future secured is to cut short all your unnecessary expenditure habits. Some people who are already on a tight budget often fall into the trap of believing that they are already limiting themselves to the strict necessities, but if they can get a look at the big picture, their beliefs may start to shift. Organize all your monthly bills properly for detecting your spending habit on your favorite cup of coffee.
Once you have a complete idea about your expenditure habits, you can proceed on making some changes in your daily expenses. The task of money management needs a little creativity from your part. Cutting all the entertainment cost is one of the most important things for everyone to follow. Think about availing the public transport facility for saving some extra money on your fuel cost. You can also try to pack a lunch whenever possible, and carefully plan your meals for the week, and you can save a lot on food bills.
Finally, don’t start picking things from sales as instead of saving some money, it would end up in making you spend a lot on unnecessary items.

Build an Emergency Fund:

Think about having an emergency fund for managing some unexpected situation in life. In spite of providing you with a low interest rate, these accounts are also well known for getting an easy access, when you are in need. These accounts are efficient enough for saving you from taking a loan.

Debt Reduction:

Eliminating debt is a huge step when you are trying to build up your savings, and the first thing most people will tell you is to pay off your credit card debt every month or to live without them if it is possible. If you are really failing to save some money at the end of a month, then think about using your credit cards only for some important occasions. The first thing you should do here is, start paying all your debts for creating some future opportunities to save money.
In spite of using credit cards on a regular basis for funding all your basic needs, think about using cash for paying all your important needs. If you will use all your monthly income behind clearing all the debts, then it would become simply impossible for you to stick to your financial goal.

Expenditures Behind Gift Items:

As the festive season is knocking at our door, we need to think about preparing ourselves for meeting with quite a huge expense. Choosing gifts for your loved ones is not at all an easy job as the gift has to be both classy and impressive at the same time. Finding such a gift at a pocket friendly budget can become next to impossible.
On the other hand, opt for giving them some hand-made gifts with your personal touch. Whatever the occasion is, giving a hand-made gift to your dear ones will definitely create a magical moment. You can get the idea of making some unique gifts from the popular online sites. All these gift items might include- a scrapbook, a painting or some knitted stuff.

Look to the Future:

Money management on a modest income is really all about prioritization. As you start to build up the big picture of financial income and expenditures, you can start to see what it will take to live within your means. This is the perfect opportunity for you to grab, where you can start saving for your future requirements. The task of money management can become fruitful, if you have a plan of sticking to your monthly budget.

Buy Second Hand Items:

Think about getting hold of the secondhand items, instead of picking the new ones. The money you will save from your unnecessary shopping will take you a step forward towards reaching your financial goal sooner. For an example- instead of buying new clothes, you can make your old ones look trendy by pairing them with different attires.

Final Words

When you are leading a life with limited funds, it is quite natural for you to get frustrated. However, with the help of these above mentioned tips it would be easier for you to prevent all your bad habits of spending behind useless items. Focusing on other essential things in life like saving for the future should be your sole aim in life.

10 Reasons You Should Have a Budget

I don’t think any of us would disagree that a budget is a great tool for saving money. That those who do the whole budget thing are financially wise.

But how many people actually have a budget they’re recording their expenses in? I’d guess not many.

10 Reasons You Should Have a Budget

In this post, I’m going to lay out 10 simple reasons you should be on a budget.


The act of gathering information from last month, adding up all your expenses from your online banking or receipts, and categorizing them will alone be illuminating.

You’ll be surprised at the amount of money you’re spending, and where. This is an eye-opening process.

I don’t recommend you stop here, but if you do, you will certainly have a much better understanding of where your money is going.


Duh. One obvious purpose of creating a budget, is to cut back on spending. Once you’re aware of where your money is going, you’ll be informed for making decisions for the future.

Perhaps that $300 bill at Target was unnecessary. Even though you had planned to pick-up just a few groceries, a lot of non-food items ended up on that receipt.

You will stop and think before you add things to the cart, be it physical thing or a graphic on Amazon Prime.


You heard me right. Creating a budget isn’t strictly about restricting what you spend. Its also about carving out space to spend money on the things that matter most to you. Vacation. College. Retirement.

So maybe $200 of that Target bill above could actually go toward a mid-winter vacation with your significant other, if you had exercised a bit of self-control.


If you don’t like how your income vs. expenses is playing out, do something about it. There are a lot of little things you can do to add various streams of income, without going out and getting a second job.

Here’s what I’m talking about. Have a yard sale. Sell furniture on Craigsist. Trade in gold and silver for cash. Sell stuff lying around your house on eBay. List your house on Airbnb while you’re going to be away.

Once you’ve set up a budget and you know what you need and want to have as income, getting creative with money-making ideas can help make ends meet and give you some wiggle room.


Even if you are surviving without a budget, you may be selling yourself short. Being more purposeful and proactive about financial planning, enables you to make goals and reach them.

And as you see certain savings categories increase, you will be able to celebrate small victories along the way to big ones. And when you reach big goals, the areas you’ve scrimped and saved will be worth the sacrifice.


I’ve heard it said, that a lot of people are one paycheck away from being homeless. And in a lot of cases, I have found this to be true.

Getting on a budget, controlling your spending, and saving money gives you peace of mind. The looming possibility of illness or job loss isn’t as dire when you have enough in savings in the bank to live off of for 3 months, in case of an emergency.

I know, it’s horrible of me to bring it up. But stuff happens. The kind of stuff a lot of us are up late at night thinking about.


If you have limited an area of your budget, I guarantee that near the end of the month, you will get creative when you feel the squeeze.

If it’s your grocery bill, you’ll force yourself to skip the store and use what’s in your pantry one night. Or if you need a formal dress for an event, you’ll borrow instead of buy.

You will become well versed at making do. And not just for the sake of dying to yourself. It will be to the end of gaining what you ultimately want. Those things that are priorities in your spending and saving.


Even if a Play Station deal is available on Black Friday at an irresistible price, you will be able to resist it.

If you go to the store for flour, you will not throw in 10 additional items, as you would if you were not on a budget.

Having a budget in place, means you’re accountable to something outside of yourself. If you buy that gaming system, it’s not going to go unnoticed. You will have to fess up, even if just to yourself, and reap the consequences.


Taking the time to set-up a budget and stick to it, does a great deal for building character, that will trickle into other areas of your life.

Organization and discipline are invaluable quality traits. I bet you won’t find an employer who does not place a high priority on employees that exhibit them.


The main thing couples have and always will fight about, is money. Undoubtedly.

You know how it goes. Opposites attract. Which often means a spender and a saver end up sharing a bed.

One way to minimize quarrels over money, is to make a budget…..together. This requires the two of you to plan together. How does give and take relate to money in your relationship? A budget is where you can hash it out.

I promise, this will avoid a lot stress. Gone are the days of shock resulting from reading the bank statement, and seeing where your spouse splurged. Gone also are the days of feeling suffocated by a partner who doesn’t want to spend a single penny more than is absolutely necessary for survival.


My hope is not to overwhelm you by all the reasons to get your butt into action. Rather, perhaps this will be the last little nudge you need to take control of your finances. To plan for a great future, now.

How about you? What are some of the biggest benefits you have found, in having a budget?

How to Live an Efficient Budget

“Twenty dollars earned, nineteen dollars spent – result happiness. Twenty dollars earned, twenty-one dollars spent- result misery.” Being good with money isn’t about how much you make—it’s about how you manage and plan.

Whether you recently drained your savings accounts during a financial crisis or you are just getting started with savings, use these tips to build or rebuild them. The secret to increasing your savings — whether it’s earmarked for your emergency fund or another savings account — is to pay yourself first.  Put the money into a designated savings account before you pay anything else. Rather than trying to save the money that remains at the end of the month, put it away first—before it gets eaten up by other expenses or you’re tempted to spend it.

How to Live an Efficient Budget

Whether you need to update your insurance, revamp your budget or scale back some shopping habits, take some time to consider these ways to have an improved budget.

  1. Decide on your goals and create an expenditure plan– For some people, there’s nothing more appealing than saving for a three-bedroom house with a white picket fence. Others dream of taking a trip around the world or a sabbatical from work. Choosing your money goals makes it easier to work toward them. Once your goals are decided, you need to create an expenditure plan. Most people spend about two-thirds of their income on three essentials: food, housing and transportation. Then there are debt payments, savings, household costs and optional items such as entertainment to consider. Create an annual budget by allocating spending goals for each category.
  2. Don’t settle with the price that’s written– Prices are often a lot more negotiable than you think, even in big-box department stores. If you’ve seen a lower price listed elsewhere, don’t hesitate to ask the store clerk if they can match it. The worst-case scenario is they’ll say “no.”
  3. Don’t rely upon just one source of income- The lack of job security in today’s market means anyone could lose their job or face a salary cut. To create a second source of income, consider turning to one of the fast-growing online marketplaces, such as Fiverr or Etsy.
  4. Maintain your additional income- Earning money outside of a full-time job can complicate matters at tax time; be sure to keep a careful record of all income earned, as well as copies of receipts related to expenses. When it comes to writing off the home office as a tax deduction, be sure to study the IRS rules, which specify that the space can’t be used for other purposes.
  5. Get rid off debts- Credit cards have among the highest interest rates around, averaging approximately 15 percent. Retail credit cards are even higher, with the average APR at 23 percent, according to Paying off credit cards as soon as possible can help reduce fees and interest-rate charges that balloon over time.
  6. Record your credit histories- Lenders base their decisions on whether or not to loan consumer’s money, and at what rate, partially on their credit histories. That means someone with a limited credit history (because they have few or no financial accounts) can have trouble taking on a mortgage. Pay bills on time, and be sure to have some accounts in your name.
  7. Calculate your retirement number- Retirement calculators, which are readily available online, make it easy to estimate how much money you should save before retirement. Since $1 million would provide around $50,000 worth of income over 20 years, you probably want to aim for more than that, depending on your lifestyle costs. Look for what you’d receive after years.
  8. Follow the risk-vs-reward-rule- Along with the importance of diversity, the risk-versus-reward trade off is one of the classic rules of investing: If you want higher rewards, you have to take on greater risk. Assess your risk profile and invest accordingly. If you like to know your money is safe, you probably want to keep it in more conservative investments
  9. Emergency Fund- Open a separate bank or savings account if you don’t already have one and name it “emergency fund”. If you find an account that earns interest, that’s even better.
  10. Golden rules for improved budget- Cut spending painless. Save for emergencies. Reduce high cost debt. Take free money and save it.

Finding a way to start saving money so that unexpected expenses aren’t so devastating may not be easy. But shifting your thought patterns can yield long-term results.

“Being a ‘saver’ as opposed to a ‘spender’ is a mindset that may not be natural to most people,” says Aries Jimenez, financial life planner for San Diego Wealth Management. “However, it can be developed through practice.”

The Psychology of Budgeting – A Few Tricks to Help You Save

We all know saving money can be difficult. There are just too many temptations out there and whenever you hit the shops to buy things you actually need, there’s always something else jumping out at you, begging you to buy, buy, buy. You may think a trip to Primark is harmless enough, but before you know it you’ve been sucked in by the super-cheap prices and forked out £30 for stuff you don’t really need.

The thing is, saving is all about motivating yourself and using your willpower to reach certain targets. I find the best way to do this is to set myself incentives. If I save a certain amount of money by a certain date I can give myself a little treat. Not something expensive obviously – that defeats the whole point of saving – but just something I really want or am looking forward to.

The Psychology of Budgeting

Another great way of putting money away is to get a money jar. Whenever you’ve got silver coins in your purse or pocket, take them out and put them in the jar. You won’t miss a few 50ps each week and before you know it, you’ll have a stash of coins ready to cash. Admittedly this is a slow process, but it’s so rewarding at the end.

If I’m getting a bit disheartened with my savings efforts I start making a list of everything I spend my money on. Do it for about a fortnight and write down all your purchases. You’ll soon notice how much you waste on things you don’t really need and this’ll make you more determined not to just throw money away. I always get really annoyed when I can’t buy something I really want because I’ve frittered away my cash.

A lot of you probably struggle because you decide to save money without setting yourself any clear goals. This means it’s all too easy to convince yourself you’ve done well when really, you’re only £50 better off. Instead, set yourself a specific goal like paying off your credit card bill. That way you’ve got more of an incentive to save a certain amount and you’ll feel much more motivated. Plus, if the end of the month comes and you can’t pay off the bill you’ll feel pretty bad about your efforts – not what you want.

Finally, don’t go to the shops when you’re feeling down. Dieters will know one of the hardest times to stay away from the chocolate is when you feel a bit low and it’s the same with shopping. Buying things gives most people an emotional boost so stay well clear!

How To Prepare Monthly Budget Effectively?

Oh, my god! Is it necessary to plan a budget? This is the first reaction from majority of the people. Shiver courses down through the spine at the very utterance of ‘budget’. In reality, budget is a structured format of your weekly/monthly/annual expenses. You can keep track of where your money goes and distribute your earning in the best possible way. Let’s go straight to how you can prepare a budget more effectively.

Create a spreadsheet in your computer. If you like to go the traditional way, buy a paper file. Create columns and rows to list categories and corresponding expenses. The headings in the columns will reflect the categories of your monthly spending whereas the rows will contain the names of months.

The first few columns must be devoted to daily expenses like grocery bills and day-to-day travelling expenditure etc. The next few categories should be reserved for regular monthly expenses like electric bills, mortgage payment, car insurance, health insurance premium, tuition fees of your children and other must-pay categories.

A separate column should be created under the heading of ‘Miscellaneous’ or ‘Extras’. It is better if the column has sub-categories with suitable heading. Most of the miscellaneous expenditure includes unplanned and incidental spending. However, some expected yet irregular spending can also be placed under the heading. If you are to attend an upcoming wedding party or birthday celebration or marriage anniversary, then you are likely to buy gifts for the event. The expenses will be included into this added column. Unexpected expenses for medical treatment or other purposes should also be contained in this category.

Maintenance cost must also figure in your monthly budget. It is not that you have to pay for your maintenance bills month in and month out, still it is important to have a separate sub column under the ‘Miscellaneous’ or ‘Extras’ category. Car repairing, change of water pipe, electrical appliances replacements etc. go into this sub-category.

Do you donate to charitable organization? The amount donated for charity purpose must not be missed out in your budget. The idea behind preparing a budget is to keep a track of your every expense.

Are you a travel buff? Exploring the unexplored – is it sort of addiction for you? If yes, then you need to add another column which will have ‘travel’ in its heading. Input in the estimated cost you need to bear for annual excursion. Depending on where you are heading to, travelling cost may be a paltry figure or a tidy sum. Whatever the amount is, you must note it down on paper or input it in the virtual file.

Benefits of preparing a budget

The best benefit of preparing a budget is you can have a track of possible expenses in more structured format. Does your take-home income exceed the budget? Voila! That sounds really great. Don’t make a waste of the left-over; instead use it to pay off old debts or for an investment deal. But if the case is polar opposite, then you need to work on your budget once again. Curb out the impulsive expenditures so that you can effectively balance your budget.

Adjusting Your Budget for the End of the Year

With back-to-school season fast approaching and winter holidays just a few months away, it’s a perfect time to reevaluate your budget for the end of the year. The last half of the year can be expensive with increased costs for kids, tons of gifts to buy for the holidays and lots of family visits for big meals. All of these things lead to increased monthly expenses that can put you in a bind if you don’t plan ahead.

To get your finances ready for the end of the year, start by looking at what expenses you have coming up specifically. The following list provides some questions you can ask to help get you started:

  • What, if any, are your back-to-school expenses?
  • Do you have family coming in for Thanksgiving or the winter holidays?
  • Do you plan on taking any trips at the end of the year?
  • Who are you buying gifts for and what do you want to get each person?
  • Will your salary be increased or decreased by seasonal employment cycles?

All of these factors can have a big impact on your budget and your bottom line, so it’s important to plan ahead to make sure you don’t end up struggling to make everything work. It’s important to be a specific as you can in estimating expenses, as well as any salary adjustments you may have in the last half of the year.

Once you know how much available cash flow you will need to cover the any costs, you can start adjusting your budget now to ensure the money will be available when you need it. This will help you avoid buying too much on credit at the end of the year and ending up in a bind when it comes to your finances. To free up additional cash flow, look to cutting or reducing any discretionary expenses from your budget, which are things you spend money on regularly but don’t necessarily need. You can commit to cooking more fresh meals at home or taking your lunch to work to reduce your dining costs, or reducing your entertainment budget.

If you evaluate the upcoming costs and you see there is going to be a problem with your budget at the end of the year, don’t wait for it to become a problem before you find a solution. Many consumers’ budget problems are caused right now by holding too much debt for their budget to handle. Developing a strategy to reduce debt quickly or consolidating debt will reduce your monthly debt payments so you have more cash flow available for the coming months.

Assess your budget to see if you can implement a debt reduction strategy to reduce debt on your own. If you won’t be able to reduce the debt fast enough, contact a nonprofit credit counseling agency to discuss your options for debt consolidation with a certified credit counselor. You may be able to reduce your debt payments by as much as 50 percent.