5 Ways To Budget and Optimize Your Money Every Month
Since graduating college, coming home from Peace Corps, starting my Master’s, accepting a full-time job, and buying a house, I’ve really started to think about the tips I use to not only save my money, but also optimize it. I’m sure you have a ton on your plate too, so here are some ideas to enhance your financial stability. With the right financial strategy, we can all strive!
I’m not a financial advisor or any sort of guru,, but I have an undergraduate degree in Economics and managing money has always been a hobby of mine (nerd alert). So take this with a grain of salt, if you will. Also, I’ve always been a saver, but I wanted to learn ways to get more for my money and be able to travel and afford adventures, so this is what I do in my everyday life to maximize my money.
1) Take out your entertainment money/budget out in CASH!
- I budget in cash, especially for variable costs. Each month, it can vary how much you spend going out to eat or weekend trips or clothes shopping. So what I do is… if I want to go buy an outfit, I’ll grab a $50 and tell myself, once the $50 is spent, the money is gone, I can’t use my card. I set boundaries with myself, knowing I have other things I want to buy later on.
- I was listening to a podcast: https://podcasts.apple.com/us/podcast/something-you-should-know/id1150124880 and it was talking about how psychologically you are going to spend less when you have cash vs. a credit card, and you are less likely to spend NEW, BIG bills. So they recommended: going to the bank, and taking out your budgeted money in crisp $50 bills.
2) Use Credit Cards like Debit Cards & …. Pay it off every month!
- When I turned 18, my mom and stepdad helped me open up 3 credit cards in my name so I could start building up credit and that was the BEST thing they could have done for me. I didn’t use them to buy anything crazy, which is important; every month, I’d use it to buy my gas and then pay it off. Over the years, I have built my credit to be able to get a car loan at 20 and a mortgage at 23.
- I get FREE money every month from points I’ve earned buying things I normally buy anyways. I pay off my card every month, and have never paid interest. So the cards I use daily are: Discover (if you’re a student) https://www.discover.com/credit-cards/student/chrome-card.html There’s no annual fees and you get 2% cash back at restaurants and for gas. For anything, not gas or restaurants, I use https://www.citi.com/credit-cards/compare/view-all-credit-cards to get 1% cash back on all my purchases. I know a lot of people who have Southwest and JetBlue cards, so they can save money on FLIGHTS!
3) Make an Amazon Wishlist instead of clicking BUY everytime
- This is a new trick of mine, but I wish I started doing this sooner. First off, create a list on amazon (https://www.amazon.com/gp/help/customer/display.html?nodeId=201936670) i.e. home wishlist, christmas gifts
- So what I do……. instead of putting the items into my cart, I put them on a wishlist and buy an items or two every paycheck. It’s so easy to spend money online and have it shipped to your house, but when you make a list, you can compare items and prioritize what you actually need and when. It’s a great way to budget, and plan.
4) Keep an excel file with how much you make and then INCLUDE fixed expenses you have every month. If you need a template, reach out to me.
- This is big for me. I like to use Excel to keep track of what expenses I have every month, and how much I have coming in. I know every month I have money being taken out of my account for my Roth IRA, my mortgage expenses, electric, etc, and those are things I need to ALWAYS take care of.
- When I can visually see how much I am making and how many expenses I have, it helps me budget, save, and prioritize. I love traveling, so I’m big into putting money away every month for travels. So if you want to put $100 aside every pay check, I’d recommend making another savings account.
5) Go through your account and make sure expenses aren’t being taken out of your account every month without you realizing.
- 5 bucks here, 10 bucks there, and it can fly under the radar.
- I started using the App called TrueBill (https://www.truebill.com/signup/?utm_source=Google_search_web&utm_campaign=WEB_WO_Brand&utm_medium=WO_Brand_Core&utm_content=&utm_term=true%20bill%20app&gclid=CjwKCAjwmMX4BRAAEiwA-zM4JrU3GKkrHDPMuSZJNN6gfjO_o2LHV5ICcJ1l7zje4shSnwcanNnITRoCjWAQAvD_BwE) and it helped me identify many different monthly expenses I didn’t realize I still had.
- Are you done with college, but you still get charged $14.95 every month for Chegg? Check your bank statements regularly to make sure there is not fraudulent activities and you aren’t losing out on monthly memberships.
This is what I do, and it works for me, but I’m constantly learning and growing, so if you have any tips, leave them in the comments!