If you’re like most people, you want to work hard and play hard every day of the week. But with so many financial factors pulling on your wallets, such as rent, utilities, cable TV bill, and insurance premiums, it can be tough to stick to a budget and set aside money for goals that don’t necessarily fit the standard of “needs” vs “wants.” If you’re determined to save and spend smart, follow these tips to help you stick to your financial goals.
FIGURE OUT WHAT YOUR GOALS ARE
Spending money is easy, but if you’re looking for ways to save it and stick to your financial goals, you need to define what they are. First, write down your primary financial goals, including both short-term and long-term ideas for your future. Then, break down each goal into a plan that you can follow to reach them.
SET UP A BUDGET
A budget is a spending plan that includes all your income and expenses. If you have a hard time sticking to it, record your daily expenses for at least a few weeks so you can see where the money goes. When you know what you’re actually spending, there’s a better chance of curbing unnecessary spending and a better chance of reaching your financial goals.
PRIORITIZE YOUR “NEEDS” VS “WANTS”
A ‘need’ is required to go on living, such as housing, utilities, groceries, and transportation. A ‘want’ is something that won’t kill you if you don’t have it but might contribute to a happier life if you do have it. So, when figuring out which financial goals are most important, factor in your needs first. Then, you can focus on your wants.
BUILD AN EMERGENCY FUND
Be prepared for anything by setting aside an emergency fund to cover your expenses if you lose a job or have unexpected costs. Your emergency fund should be three to six months’ worth of living expenses and should be kept in a separate account from anywhere you might withdraw it – such as a savings or checking account – so you aren’t tempted to spend it.
HAVE A RETIREMENT FUND
You should also have enough money in retirement savings to live comfortably, so factor that into your financial goals. However, be sure you aren’t sacrificing your future to live more comfortably today – and it may help to consult a financial planner for advice on how much you should be saving for retirement.
TRACK YOUR PROGRESS
Once you’ve defined your goals and started saving and spending according to that plan, it’s essential to keep track of your progress. If you don’t reinvest money into your savings account each month, for example, you won’t be able to tell if your efforts are actually accomplishing anything. So make sure you take the time to review your progress every so often to stay on track.
CONSULT A FINANCIAL ADVISOR TO HELP YOU STICK TO YOUR PLAN
Consider hiring a financial advisor if you don’t find it easy to stick to your budget and plan. Financial planners can help keep track of all the little details that come with getting your finances in order, such as insurance plans and investments. That way, you don’t have to worry about missing any steps along the way.
With determination and the right financial tools, anybody can stick to their goals and start living within their means. Always ensure that your money is going towards a larger purpose – and if you reach a goal, set up a new one to keep the momentum going. We must budget and prioritize our needs vs our wants if we want to save and stick to our financial goals. It is always a good idea to stack away funds for emergencies and retirement. It is mandatory to keep track of our financial progress to motivate ourselves to stick to our goals. Approaching a financial advisor would benefit us in staying on track!