Are you new at the art of creating and executing a personal budget plan? Does the idea of balancing your check book make you a little bit queasy? If the answer to these questions is yes, don’t worry, you’re not alone. It is very daunting to create a personal budget, especially if you have only recently become financially independent. It is easy to think that you have thought of everything. Sure, you know you have to buy toilet paper, dishwashing soap, pay for laundry and coffee. Have you thought, however, about ketchup?
Ketchup may be the single easiest thing to take for granted when not living on your own. It is not by any means the only unexpected expense that you will encounter when blazing your own trail in the world. This doesn’t have to be so scary, however, and even if you are not fantastic at balancing a check book or saving every receipt, there are some easy ways to budget your money effectively. Surprisingly, there are a couple of ways to use your credit card in order to more effectively set aside money that needs to be used for certain things.
One way to use your credit cards to create a strict budget for yourself is by having cards that are designated to specific things. For example, if you have a card for a gas station like a Mobil card or a Shell card, you can deposit your anticipated weekly gas expense each week when you get paid, and then you know that it is in that specific account, while still earning rewards for your faithful gas purchases. You can do it the other way as well, paying the bill each month. Make sure, however to pay the bill on time and not to spend beyond your means just because the money is there.
Another way to use credit cards in order to budget is to designate your credit card for all of your grocery purchases, etc. and just pay the bill each month. Get a checking account that does not have a debit card attached to it, in order to minimize your spending, and use your credit card instead, but make sure that you make the connection in your head to the actual funds that you have. Keep a credit card balance that is within your means. Even if you have a credit limit of one thousand dollars, if your monthly intake is only about seven hundred, pretend that your credit limit is lower. In the long run, it will keep your record a lot more clean, which will lead to more opportunities overall financially.
Keep track in a small notebook of how much you have spent on each thing on each card, and pay it all at once out of your checking account. This will keep your bank account healthier, and your finances all in order. This way, you can build good credit, form healthy financial habits and be ready to face whatever challenges your future has without worrying whether or not you can finance them.
