A budget is a financial plan that outlines the expected income and expenses over a specific period, usually monthly, quarterly, or annually. It helps individuals and businesses to manage their finances and make informed decisions about spending and saving.
Here are seven tips for creating and sticking to a budget:
- Start by tracking your spending: Keep track of all your expenses for at least a month to identify areas where you can cut back.
- Set realistic goals: Determine your financial goals and make sure they are realistic and achievable.
- Prioritise your expenses: Categorise your expenses into needs and wants, and prioritize your needs before allocating funds to your wants.
- Create a budget plan: Create a plan that outlines your expected income and expenses, including fixed and variable expenses.
- Review and adjust your budget regularly: Review your budget regularly to track your progress and adjust it as necessary.
- Build an emergency fund: Set aside some money for emergencies to avoid dipping into your savings or taking on debt.
- Seek professional help if necessary: Consider seeking help from a financial advisor if you need assistance with creating or sticking to your budget.
An easy-to-use tool for budget planning is available here.