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How To Budget Your Three Sources Of Retirement Income

retirement fundRegardless of the type of retirement income that you are expecting to receive, you still have to consider how you will budget it. If you think that retirement exempts you from budgeting, that is wrong. If there is a time in your life that you need to practice money management, it is when you retire.

The main reason for that is so your retirement money can outlive you. If it is the other way around, you will have a huge problem in your hands. It is difficult to earn more money when you run out of it in your retirement.

There are three usual sources of income after you retire from work: Social Security benefits, retirement plan and your personal savings.

Some people who have failed to take advantage of any retirement plan are usually relying on their Social Security benefits as their sole source of income. Based on an article published on, it will be very difficult if you rely on this income alone. The average amount that current retirees are receiving from this agency is a little more than $1,300. That totals to $15,600 a year. It is not enough for anyone to survive.

This is where the second source of retirement income comes in – the retirement plans. Based on the information from the same article, 88 million Americans are currently participating in a plan. The average balance that is currently available to each retiree is estimated at $62,500 – or $2,500 a year. At least this is true if they follow the 4% rule of withdrawal after retirement. This amount is even more pitiful compared to Social Security benefits.

The last source of income for retirees is their personal savings. Now this will vary per retiree. While it is hard to determine how much this can be estimated, it can be assumed that it will not be a huge amount. If people cannot afford to save up for their retirement plan, it is unlikely that they will put aside a huge sum in their savings account.

Given these details, it is evident that a lot of people may be facing some problems when they retire. Although there are several sources of retirement income, it seems unable to meet the financial needs of retirees.

Tips to budget your retirement money

We all know that the best way that you can make your money will outlive you in retirement is to budget it. But when you are working on your retirement budget, there are two things that you need to remember.

Simplify your budget

Actually, if you have the knack of going into details and you enjoy being meticulous about your finances, then feel free to create a budget plan that you will feel confident with. But if you do not want to make things complicated, then you can simplify things. You can use a simple envelop method wherein you will put your cash in labeled envelopes and stick to whatever amount is there. Or you can separate your expenses into major categories and clearly define what you will use it for.

In an article published in, a couple living on $31,000 a year is able to do so because they are budgeting their limited retirement income. Barrett, the 66-year-old retiree featured in the article, said that it is possible to live on a small amount as long as it is all written down. When you write it down, you can figure out what you really need. She and her husband can survive on $2,393 each month. This is the combined income that the couple get from Social Security. Believe it or not, that amount pays for their living expenses plus their credit card debt and a savings program.

The budgeting system that worked for them is the envelope method. This proves that you do not need to complicate things to make budgeting work for you. Find the right budgeting method that suits your personal preference and your retirement income.

Keep an eye on your dwindling funds.

The next thing to remember is to always be conscious of what is left of your money. You need to keep your retirement fund from retiring before you. The only way to make sure of that is to keep an eye on what you have. You need to check how much balance you have left. This is especially true if you had to make a huge withdrawal all of a sudden. This usually happens after a major medical need. Calculate how much you have left every time you make a bug withdrawal. In case your calculations show that you will run out of funds sooner or later, you can still find a way to add more to your income.

You need to be very careful about your spending. Do not blindly spend on things without checking how much you have left. There are factors like the lower interest rate and inflation rate that can affect the balance that you have in your retirement fund. Only you can look after your retirement income so make time to check on it every now and then.

Expenses that can drain out your retirement fund

The thing about your retirement money is that everything will be going out – nothing comes in. Unless you are working in retirement, your money will only go down from hereon. You will probably see a bit of increase because of the profits that your money will earn from retirement plans. However, your expenses will surely be faster than whatever interest your portfolio is earning.

Beyond that, here are other expenses that may be draining out your funds.

  • Healthcare costs. This is an expected expense. However, most people are unsure of just how much their health will cost them in retirement. According to a report from, a 65-year-old healthy couple should expect to spend $266,589 for medical-related expenses. This is true for those who are covered by Parts B and D of Medicare and a supplemental insurance policy. If you do not have any, then expect that you will spend more. The data indicated that if you add dental, eye care or other out-of-pocket expenses, the amount will go up to $394,954. If you retire earlier, the amount will rise as well.
  • Grandchildren. While you may want to help out your struggling adult children with their own children, you need to be cautious about the financial assistance that you will provide them. Not that you are trying to be heartless or anything. But think about it. If you run out of money and it comes down between you and your grandchildren, your children will probably help out your grandchildren first. So secure your funds before you send your grandchildren money. Even if your adult children promises to return the money, you still need to be cautious. Most of the time, you will not be repaid. If you really want to help, give only what you can afford to lose from your retirement income, nothing more. That way, you will not become a burden to your kids in the future.
  • Vacation. Another expense that you need to be careful with are your travel expenses. You deserve to travel and enjoy retirement. But despite that, you need to be careful too. Make sure you only plan for debt-free vacations. Since you have a lot of time in your hands, you can afford to plan ahead. Book everything in advance so you can get a discount. Pay for everything – the travel tickets, board and lodging, and even the tickets for the events or places that you will visit. That way, the only cash that you need to bring with you will only be your pocket money. This should keep you from overspending your budget.

Think about these expenses when you are budgeting your retirement income so you can make the right decisions about them. That way, you can stretch your money to last longer than you.

Here is a video that discusses the common problem that retirees have – how to not outlive their retirement income.

Budgeting Tips When You Earn The Minimum Wage

piggy bank with minimum wage tagIf you want to survive on a minimum wage, you need to look for budgeting tips. This is one of the techniques that will help you achieve financial independence. This independence simply means you have set up your finances in such a way that you can provide for your needs without being forced to work full time. Well this is a long shot for someone who is living on a minimum wage. But if you use a budget, it may be possible for you to achieve just that.

A budget plan is simply your way of identifying how much you earn and deciding where it will go each month. When you set this plan in place, you can control where you will spend it.

The beauty about having this plan is you can see the activities of your finances. Through this plan, you will be aware of your current financial condition. It can help you make the right decisions about your financial life. When you have to decide to buy something, you can smartly decide if you can afford it or not.

In fact, even if you experience a wage increase, you need to continue following a budget. An article in the revealed that the local government is thinking about increasing the minimum wage of fastfood workers to $15/hour. This is a huge increase from the current $8.75/hour minimum wage. But while that is true, it still requires budgeting tips to make it easier for you to survive on it.

Sample budget plan of a minimum wage earner

So what does a budget plan look like when you only earn the minimum wage? We found an interesting budget done by an author writing for This particular budget was written back in 2014 and was based on a minimum wage of $7.25 an hour. This is the wage of approximately 1.6 million Americans.

According to the article, these are mere estimates. You still need to factor in where you live – since the cost of living varies from State to State. Here is a sample budget of a minimum wage earner. You may be able to get budgeting tips by looking at this example.


For the income, assuming that the worker is working 40 hours a week, they will earn $290. This is $15,080 a year. Both are before income taxes. When you factor in taxes, the minimum wage employee takes home $13,572 a year. This is $1,131 a month.


Now here is a list of basic expenses that you can afford to pay off with a minimum wage:

  • $73/month for electricity – this is based on the rate in Idaho that has the cheapest rate.
  • $700/month for rent – this is based on the rate in Louisville.
  • $20/month for water
  • $44/ month for health insurance – most states allow minimum wage earners to qualify for Medicaid.
  • $70 for a monthly pass – estimate based on the price of different states.

This list of expenses is already $907 a month. It only covers the basic utilities and the lodging arrangements. It only leaves you with $224 for the food. That leaves you with a budget of $7.4 a day for food. But then again, what will you do about other expenses like what you need around the house (cleaning products, etc). It also does not cover the gas costs that is used to help regulate the heat inside a home. You do not have room for your savings. If something bad happens, you might be plunged in debt all of a sudden.

Obviously, this budget needs a lot of improvement. You need to implement budgeting tips that will help you free some money for your other expenses.

Well this is how your budget can help you stay out of debt. Thanks to your budget, you can now identify what you can possibly do in order to free up more money for other expenses. For instance, you know that the biggest amount spent here is on your rent. If you need more money for food, you obviously need to lower your rental amount. That $700 is too much. What you need to do is to look for a house that you can rent for only $500 or less. Going down to $500 will free up $200 for additional spending. You can also opt to get a roommate so your housing cost will go down to $350 a month. That frees up $350 for your budget.

You see how a budget plan will help you fix your financial situation? When your finances is laid out like this, you will know understand what your next steps are. What you need to understand is that it is not always necessary that you get a second job. Look at your expenses first to see how you can make ends meet.

Tips to help you budget despite a low income

When you are earning a minimum wage, you are forced to do what you can to make ends meet. One article published on told the story of someone who earns a minimum wage in a fastfood restaurant. She gets paid $7.40 an hour and she said that no matter how many hours she works, she never made more than $15,000 a year. This is regardless of the position that she holds in the restaurant – whether it is as a cook or cashier. What she does to help make ends meet is to work two jobs and to live with her mother. This allows her to survive despite the minimum salary she is earning.

Now if you want to survive on a minimum wage, you need to implement certain budgeting tips. To be clear, these are tips that will help you stay within your limited income. Here are some of our suggestions.

  • Live in a rural area. We all know that the closer you live in the metro, the more expensive things get. Live in a small town so you can find a home for rent for $300 or less. That way, you can live alone even if you only earn the minimum wage.
  • Plan your meals. There are so many benefits to doing this. You can list the products that you need to buy and decide which of them you will buy in bulk. It is also possible for you to take advantage of leftovers. Think about this so you can maximize the savings you can get from your food costs.
  • Let go of your car. This is something you can live without. Opt to live near your work and just walk or bike to get there. You will save a lot of money in the process.
  • Save your loose change. Even with the best budgeting tips, it is extremely difficult to save when you only earn the minimum wage. But that does not mean it is impossible. Try to divert your attention from the amount – just save whatever you can. If you set a $10 budget for yourself each day – save whatever is left – even if you only have pennies.
  • Use coupons. These can be a great way for you to get discounts on the usual products that you buy. It can be a bit tedious but any amount you save can really help you stick to your budget.
  • Know where to buy products. You want to get them cheap but make sure you are not sacrificing quality. Buy where you can get the best value for your money. Since you are planning your meals, it should be easy to schedule when and where you will buy what you need.
  • Be on the look out for what people throw out. There are treasures in what people consider as junk. Some people find great furniture by getting the stuff that people throw in the streets.
  • Opt for free entertainment. We all need to relax and indulge in activities that make us happy. You deserve it. But if you can get it for free, then you do not have to compromise your budget just to relax.
  • Take care of yourself. Although a lot of minimum wage earners are forced to work two jobs, it is very important that they do not do it at the expense of their health. The cost to get medical treatments can be very high. Prevention will go a long way in terms of savings. So put your health first.
  • Learn to do things on your own. You will save a lot if you learn to cut your own hair, do your own nails and even sew your own clothes. Even if you are earning the minimum, you do not have to look like one. Sometimes, one of the skills that you will learn might even help you earn extra – if you can master it enough.

Follow these budgeting tips so you can live a happy life despite a low-income household.

Budgeting Tips When You Want To Live Alone And Can’t Afford It

woman alone in a houseDid you know that budgeting tips can help you achieve independence? You can do just about anything as long as you know how to budget.

You see, the financial problems of consumers are not really because of lack of finances. Even if you are earning a low income, you do not have to give up doing what you want. For instance, if you want to live on your own, you do not have to give that up. You do not have to let your income keep you from living alone. If you are tired of having roommates, then you do not have to suffer just because you feel like you cannot afford it. You can very well afford to rent your own house as long as you know how to implement certain budgeting tips.

Of course, the ideal scenario is to own your house. However, current financial situations make that impossible. This is especially true for the young adults who are burdened with student loans. This debt is the reason why some people are currently renting and have passed up homeownership. According to, this is driving the increase in the number of houses for rent. Every year since 2004, there was an average increase of 770,000 rental houses. In 2014, the increase was up by 35.5%. Despite that increase, the rental vacancy rate is currently low.

We all know what happens when the demand is high and the supply is low – the price of rent increases. Given this data, do you really think that budgeting tips can still help you afford living on your own?


How different will budgeting be when you live on your own?

It is very much possible to be happy despite having a low income household. In fact, you need to learn how to be happy regardless of how much you are earning.

The key to that is a simple formula of building your lifestyle around your net income after savings. This means you have to take your net income, remove a portion for your monthly savings. Anything that is left after that is your budget. You need to build you life around this amount and do not go beyond it.

Once you learn to live by these rules, you will understand how you can afford to live alone, without roommates, regardless of how much you are earning.

There is an article published on that discusses the cost of living alone. It explains four important considerations when you are planning to live without any roommates. Let us go through them one by one to understand the budgeting tips you need to learn.

  • You will pay more on rent. This is actually quite obvious. Since you are living alone, you will be solely responsible for paying off your rent. Of course, you will be living in a smaller home – which is cheaper than the bigger one that you rented when you lived with someone else. But although that bigger home was more expensive, you had someone to share the cost with. That is no longer the case. The article cited an example with the apartment rates in Chicago. A 1-bedroom apartment that costs $1,607 is still more expensive compared to a 2-bedroom apartment that makes you pay $902 (remember you are paying only half). The rates will depend on the city you will live in but it is generally the same – you pay more when you live alone.
  • You will pay more on utilities. The same concept applies here with rent. Obviously, since you are the only one consuming at home, you are also alone in shouldering the costs of your bills. Your water and electric bills will be solely your responsibility. If you want to get cable or Internet subscriptions, you are on your own in paying for that. Of course, your electric and water consumption will be lower and that means your bill will be smaller.
  • You need to buy your own furnishing. Renting a furnished house is usually more expensive and that means you need to buy your own stuff when you live on your own. From the bed to the dining table to the sofa – all of these will have to be bought. If you want decorations and other stuff, these will go to your tab as well. The article also mentioned even your cleaning supplies and other kitchen and bathroom necessities will be all on you.
  • You can control your bills. The last consideration that was discussed in the article involves choosing the bills that you will pay for. According to the article, this is one of the few financial benefits to living on your own. You can control what you will subscribe to based on your budget and your own personal preference. If you want to save money, you can choose to lower your use of heat by simply wrapping yourself with a blanket – and you do not need to discuss it with anyone else.

Obviously, living on your own is more expensive. But that does not mean there are no budgeting tips that you can follow in order to afford living without any roommates. Just make sure that you save up for this change in advance before you make your move. That way, your finances will not take a huge blow. Remember, you need to save up for the security deposit and the rental advance that landlords usually ask for. And you need to spend on the move itself – plus the other stuff that you need to buy in order to make the new place a home.

Tips to make living alone fit your budget

According to an article published on, you need to earn at least $15.50 an hour in order to afford renting a one-bedroom apartment. That is almost double the amount that minimum wage workers are earning. That means if you only earn the minimum wage, it would be very difficult for you to rent on your own.

But of course, that does not mean it is impossible. There are a lot of things that you can do to make living cheap. Here are budgeting tips that will help you afford living without roommates.

  • Know how much you can afford. Take a good look at your net income and your expenses. You need to consider how much change in expenses you can afford. It will help you plan your next move. Ideally, your rent should be no more than 25% or 30% of your net income. Make a budget plan and stick to it. If your expenses end up being more than your income, you may have to make the difficult decision of giving up certain expenses.
  • Build up your emergency fund. Take note that this is not the amount that you will spend when you move or when you buy your furniture. This is your savings for any unexpected emergencies that you will encounter. After your move, your finances will be a bit tight. Having this emergency fund will be very useful in case your car needs a new transmission or you need to buy medication for an illness, etc.
  • Choose where you will live. Some cities are cheaper than others so select the city that you will live in. If you have to live in an expensive city on your own, then rent a small space for yourself. There are a lot of beautiful studio units that you can decorate well to make it spacious and comfortable. Be reasonable when choosing the neighborhood too.
  • Buy 2nd hand furniture. In case you have to buy a lot of stuff for your new home, you may want to consider buying 2nd hand furniture instead. Go around the neighborhood and see if there are yard sales that you can buy items from. You can also go to Craigslist or a similar site where you can buy items really cheap. Also, you need to plan what you will buy first. If you can forego buying a dining set because you can eat on the floor or on your lap for the meantime, then make that sacrifice. That way, you do not have to use credit when making purchases. You can also ask family and friends if they can give you any old furniture or household item for free – at least, if it is something that they do not need anymore.
  • Plan your household budget carefully. You need to think carefully about how you will spend on your new lifestyle. The usual tip is to cook your own food but sometimes, when you are all alone, eating take out is more economical. Instead of getting both cable and Internet, you may want to just get an Internet subscription and watch your favorite shows from there. For your other household needs, compute if it will come out cheaper if you make your own cleaning materials like detergent, etc.

These budgeting tips will really help you afford living without a roommate regardless of your income. Think carefully before making this momentous step. There is freedom in living on your own but there are a lot of financial responsibilities too.

7 Ways Your Budget Plan Is Being Compromised By Your Expenses

wallet with a band aidIf you are trying to practice smart spending, there is one tool that you will need to have: a budget plan. After the Great Recession, more and more consumers understand the need for budgeting in their financial lives. But that understanding does not necessarily come with application.

Although more people are budgeting, it is not enough to correct the spending habits that have ruined a lot of consumers during the economic collapse. According to the McKinsey Consumer Sentiment Survey, more people are living from paycheck to paycheck compared to 2012 and 2013. Also, more people admit to a decreased ability to make ends meet. The results published on revealed that more consumers may be optimistic about the country, but that does not mean it is making our financial situation better. For a lot of us, things just seem to be stagnant – not improving but not declining either. This is not a good indication when you think about the improvements in the economy.

One cannot help but wonder – what would it take to improve our financial situation? A budget plan can certainly help.

7 overlooked expenses that can cripple your budget

There are many ways that budgeting can help us improve our finances. In can actually help us with our debt payments. It can also help us understand the limits of our spending so we are kept from overspending. It can even help us fulfill a lot of financial goals. There are several benefits when you implement and follow a budget plan but the thing is, you have to make sure that it is effective.

While your implementation and commitment to follow a budget is the key to its success and effectiveness, you need to understand what can ruin it. One of the things that has a great effect on your budgeting success is your spending.

An article published on revealed that Americans belive tht the economy is improving. This may be good news but it is also leading a lot of consumers to spend more than what they think is allowed by their unique financial position. The article mentioned how consumers are now more courageous when it comes to making purchases like new cars, electronic devices and other appliances. While the financial circumstances may be making it more possible to make the purchases, it does not signify that the economic situation in the household is ready to hold these commitments. In fact, there are a couple of expenses that may have escaped your noticed and are actually draining the effectiveness of your well constructed budget plan.

Here are 7 expenses that you should be careful with.

  1. Maintenance and repairs. This holds more true for vehicles but it also applies to your home. A busted transmission in your care may not be a huge expense but it could enough to throw your budget plan off balance. A string of car repairs can also force you to use your credit card and thus put you in debt. You have to ensure that your vehicle is well taken cared of and goes through a regular maintenance check to avoid expensive surprises. You need to think about these things and include them in your budget plan to avoid the effects of an expense you are not prepared for.
  2. Occasional events. A perfect example of this are weddings. They only happen once and even if you were just invited, it will still cost you to buy a dress or a gift for the event. Not to mention travelling to where the wedding will take place – if it is a destination wedding. Unless you can get the funds from one category in your budget, you may want to just decline going to the event – lest you end up in debt.
  3. Extracurricular activities for the family. This includes any sports related activities or training that your child would like to have during the summer. If your child is passionate about a certain sport that requires expensive training, how can you manage paying it all off. It pays to talk to your child so you can plan around these expenses and thus get yourself ready for it. You can include it in your budget plan – specifically in the part where your savings are.
  4. Pet expenses. While they are not as expensive are children, they can still rack up costs each month. You need to think about their food, veterinary care and everything that will help them live comfortably with you. Do not ignore their needs because a sudden trip to the vet may lead to a financial problem.
  5. Spikes in utility expenses. You may have created a flawless budget plan but have you considered how it needs to change over time? For instance, your budget for heating may not be the same in the summer and winter. Factor in these changes in your budget so you will not fall short anytime during the year.
  6. Health expenses. An unexpected medical expense, no matter how expensive are something that you need to prepare for. In fact, a lot of people have fallen into a financial crisis because of an unexpected illness. Do not let this happen to you or any of your family.
  7. Unplanned snacks. This is something that most of us are guilty of. This is a small expense – but that is what makes it very dangerous. Since it is a small expense, we rarely put it in our budget plan. And the amount is also the reason why we are not guarded when making these impulsive purchases. If you do it everyday, this small amount will add up. Make sure to know how much you are allowed to spend each day so you will be kept from overspending on your budget.

Make sure that you will not overlook these expenses. A budget plan may be able to help you  get out of debt, but its failure may also keep you from seeing that debt is creeping back into your life.

Here’s an interesting way of managing your money

You have to understand that budgeting is something that some consumers are not enthusiastic about – even if it will lead to their financial independence. That may be caused by its reputation for being a tedious task to do. This may be true – but mostly at the beginning. You have to make sure that the details of your budget are all correct. But even if the bulk of the job is at the beginning, you need to continually check on it as your life changes.

The truth is, budgeting is very important because it helps you practice money management. You may not like the traditional budget plan, there are ways for you to organize your finances.

An article from discussed three simple steps that you may want to follow. It is not as tedious but it will make sure that the important goals of a budget plan is covered.

  • Automatic transfers. First of all, you want to set up automatic transfer for regular payments that you make. This includes your rent or mortgage, saving goals, retirement, taxes, insurance, etc. Any payment that is consistent in amount and due date can be paid this way. This will allow you to get rid of the details and just concentrate on the total amount that your account has to have each month. You can include all your priority expenses here – even if they are estimated. Just make sure your estimations will always be more than the actual payments. That way, you will not be charged with late payment charges caused by insufficient funds.
  • Strict discretionary funds. The second step is to set up an amount that you can use each month. After defining the amount, you can enjoy spending it however you wish. With all the priority expenses taken cared of, you can enjoy this money as you see fit. Of course, when you spend it before the month ends, you have nothing left. That means a bit of control and monitoring is still in order.
  • Balance your accounts each month. This type of money management will not give you a tedious monitoring task but you still have to make sure you stuck to your budget. This is why you need to reconcile your account at the end of the month to make sure that your payments are met and you have sufficient funds to meet them.

This is one option that you can do in place of budgeting. What you will prefer to use will depend strictly on your personality of course. Both are effective but you may find that following a budget plan can help you develop the right financial habits and enjoy the benefits of having organized finances. Here is video that will enlighten you about the benefits of following a budget plan.

Why Budgeting Should Not Be Likened To Dieting

money and measuring tapeBudgeting is said to be the first step towards financial independence. If that is the case, then why is it that a lot of Americans are finding it difficult to maintain a budget? In some cases, they even have difficulty in starting one.

This is probably caused by the lack of motivation to follow a budget plan. This is especially true if you think that a budget is a lot like a diet.

In truth, there are a lot of similarities between the two. An article on actually discussed various similarities between dieting and living on a budget. In fact, the author of the article mentioned that a diet is defined as restricting one’s food intake. The same is actually happening when you are budgeting. You restrict your spending on some things so you can keep yourself from running out of finances of the expenses that matters most. In general what you want to happen with your budget is to stop overspending your money.

However, there are people who have not been successful with their budgets because they associated it with dieting. That is because in terms of motivation, comparing a budget to a diet is not the best way you should go about it.

3 ways diet concepts can ruin your budget intentions

An article published on in 2011 is titled, “Why a budget is like a diet – ineffective.” In one part, the article discussed how humans are notorious for not being able to follow plans. While there are those who undoubtedly can, there are also people who are incapable of doing so. In fact, some consumers frown upon budgeting as they would a diet plan. The article said that it is because a budget feels so much like dieting – that is why it is met with so much distaste. People end up shying away from budget plans simply because it is associated with diets.

The reason why people are scared to budget in the same way that they are of dieting is because it is oftentimes associated with these three concepts.

You feel you have fewer options

When you are on a diet, you are oftentimes told to eat only healthy meals. That makes your options quite limited. You are not allowed to eat certain food and drinks in order to keep yourself in tip top shape. Unfortunately, a lot of the food that we are told not to eat are those that taste good!

The same is true for budgeting. When you create a budget plan, you are faced with the reality of how much you can really afford to spend. After you identify your net income, you need to divide it among the important expenses that you make each month – for the house, utilities, food, transportation, etc. Whatever is left will have to be put aside for your savings. There is not much room for splurges or unnecessary spending especially when you have debt payments to include in your budget.

However, you do not have to feel this way about budgeting if the few options are the most important expenses that you have in your life. Even if you had to cut back on a lot of things, if the vital expenses are met, then you should not feel that you have fewer options. You just gave up on the spending that you do not really need.

You feel deprived

Since you have fewer options when you are budgeting, you will naturally feel deprived. When you are on a diet and you love to eat junk food, greasy food and all the other fattening stuff, you will feel deprived after entering a diet plan. These are the big no-nos in dieting.

In the same way, following a budget would also mean you have to stop doing the habits that are bad for your finances. Things like impulsive buying or buying things without comparing prices. These practices can be harmful to your finances. Your budget plan will deviate you from these practices and this is why you are bound to feel deprived when you are budgeting.

But just like the first, you do not have to feel deprived if you also focus on your priorities. As long as the priorities in your life are satisfied, you should not feel deprived at all. We make budgets hard to follow because we keep our eyes on what we cannot do. But if you concentrate on what you can now achieve (e.g. bigger savings, room for investments, lower debt balance), then you should not feel the deprivation at all.

You feel the pain

Lastly, dieting is usually associated with a lot of pain. This is mostly caused by the exercise that you need to do while you are regulating your food intake.

In the same way, budgeting could bring you some sort of pain as well. First of all, a budget plan is not a one time effort. You need to constantly monitor it and revise it as your financial needs change. Not only that, if your budget reveals that your current income is not enough, you may be forced to look for a second job in order to make ends meet.

Some people may say that if a budget will force me to work 2 jobs, why would they want to create a budget plan in the first place? While the sentiment is understandable, you should realize that not acting on what your budget plan encourages you to do is only delaying the inevitable. If you are spending beyond your means, you are bound to accumulate a lot of debts. Your budget will save you from that but you need to deal with the sacrifices that come with it.

Tips to make budget plans more bearable

In the end, budgeting and dieting may have some negative things in common but the bottom line is, they are both necessary because they keep you from bigger problems in the future. But if associating one with the other will keep you from incorporating a budget plan in your life, then you do not have to treat them the same way.

A budget plan is still different because it involves your finances. You need to look at a budget in such a way that will liberate you from the threat of a financial disaster. A budget can really improve your finances because it helps you be in control of your money.

According to an infographic found on, more than half of Americans do not have a budget and that one-third is unable to pay their bills on time. There may be a lot of factors involved as to why consumers cannot pay their bills on time but you can bet that one of these reasons if a lack of a budget.

In case motivation is a problem, here are some tips that might help you set up a budget in your life.

  • Start with a goal. This is the best motivation that you can give yourself. It can be to get out of debt or save up for retirement.
  • Go slow. If you discover that you have a lot of expenses that are unnecessary and that you have decided should be cut off, try to do it one at a time. Do not go cold turkey to keep the pain from becoming too hard to bear.
  • Create a timeline for your goal. Keeping in mind that you need to go slow, create a reasonable and realistic timeline to achieve your goal. That way, you will not push yourself too hard or be too relaxed in reaching your goal.
  • Make your budget as accurate as possible. Wrong entries in your budget might lead to incorrect assumptions and thus the failure of your budget.
  • Get support. If things get really tough, you may want to get support from family and friends. Or if you can afford it, go and get professional help. In most cases, the first few steps are always the hardest. But once you get one foot in front of the other, you will find yourself effortlessly following your budget.

To learn how to set up a budget, here are some tips from National Debt Relief.

7 Ways You Can Make Budgeting Fun

woman carrying groceriesThere are several good reasons why you use a budget in your household finances. Budgeting is the first step towards financial independence. Not only that it can help you strategize how you can reach all of your financial goals.

Best of all, a budget can help you avoid debt. An article from revealed that the unexpected costs are not really unexpected. We know that they will happen. The problem is, we do not budget for them. We sometimes fail to prepare for expenses like birthdays, weddings, and even car repairs just because did not put them in our budget plans. If you think about it, these are expenses that know will happen. Weddings are once in a lifetime events that couples will reveal months before the actual date. Birthdays happen every year. Car repairs – each car part has a specific lifespan that you should be aware of. These are all expenses that you should be prepared for because you know that they will happen. Even the real emergencies like accidents and illnesses can be prepared for in advance. You just need budgeting to prepare for all of them.

The truth is, we all know how important having a budget is. However, not everyone is successful at it. The reason for that is a wrong perception and implementation of a budget plan. Some people find a budget plan to be restrictive and complicated. But an effective budget is actually not complicated nor is it restrictive. In fact, a budgeting can be fun if you know how to implement it correctly.

How can you make budget implementation fun

Some people start organizing their finances but end up giving up on it because they are having trouble sticking to a budget. If you want some motivation to make a budget plan a regular part of your life, you may want to follow these 7 suggestions to make budgeting fun and in effect, easier.

  • Use a budgeting application. There are so many budget apps that are available in the market. You can start your search by going to review sites or news websites like for a list of the best apps that you can use. These apps can help you organize your finances easily. It can also help you automate the tracking of your finances. The app can make budgeting less tedious and that should encourage you to continue using it so you can monitor where your money is going.
  • Anticipate your goals. All budgets should be aligned to your financial goals. Your goals can be to pay off your debt, grow your savings or put aside money for investments. These are all great financial goals that a budget plan can help you achieve. To make your budget more fun, you might want to keep your eyes focused on your prize. If you have to create a visual representation of your goal, then do that. Put it in your ref or your workstation. If your goal is buying your dream house, print a small photo of that and tape it to your credit card. That should make you think twice before you use your card for unnecessary purchases. Your goal should keep you motivated to stick to your budget plan.
  • Set up milestones. If you have long term goals, it helps to set up milestones so you can be encouraged to implement your budget to reach them. These milestones will help you concentrate and take note of the progress that you are making. Every time you reach a milestone, you will find the motivation to reach the next milestone. Having these little goals will give you something to look forward to as you deal with the sacrifices involved in changing your financial habits for the better.
  • Give yourself small rewards. If the milestones are not enough to motivate you, give yourself small rewards after reaching a milestone. Or, you can reward yourself if you stick to your budget every month. For instance, if you succeeded in paying all your bills on time, allow yourself to give in to small indulges – as long as it is still within your budget.
  • Make budgeting a group activity. Involving other people in your attempt at budgeting will help make it more fun. Let your friends in on your budget plan efforts and encourage them to do the same. Compare notes and you can even turn it into a game. You can also include your family – especially when it comes to saving. Let your kids compete at who will have the most savings each week. These should make the sacrifices needed in implementing a budget more acceptable.
  • Join a community. If you cannot find friends who will be with you in your budgeting efforts, you can find companions online. Find an online community and share your experience with them. You might find some advice on how to stick to your budget plan. It helps to know that you are not alone in your struggle. And talking to real people who have successfully passed the difficulties that you are going through should make things easier for you and will keep you from feeling discouraged.
  • Learn something new. If your budget plan requires you to lower your spending, you might want to learn something new so you can meet that budget goal. For instance, learn how to bake so you can lower your food costs. You can also learn how to make your own household products to save on groceries. Not only will you be successful in sticking to your budget, you can also improve your skills.

A budget plan will help you spend on the important things in your life

One of the benefits of a budget plan is it will allow you to spend on the things that are important in your life. Contrary to what others perceive about budgeting, it will not restrict or deprive you of what you want to spend on. The goal of a budget is to help you find the means to pay for what you love to indulge on without putting you in debt.

According to, less than half of consumers spend more this year compared to the last. Only 18% said that they are spending less. When these expenses are detailed, it is revealed that the increase in spending is mostly on household necessities like groceries, utilities and gas. This could mean that consumers are wising up when it comes to spending – which is a good thing. But that also means that a budget plan should still be implemented because of the following reasons:

  • It can help you organize your money. One of the benefits of budgeting is in helping you organize your finances. You can identify how much money you are earning each month and where each penny will go. You can control that and make sure that it only goes where you want it to.
  • It can help you make financial decisions. Having an idea of your overall financial situation is one of the best benefits to a budget plan. If you are tempted to buy something, you can simply consult your budget to see if you can afford it or not. If not, then you can choose the expenses that you can cut back on to afford it. If there is none, then you know that the answer to your expense is a no.
  • It can help you grow your savings. A budget plan will give you more chances of meeting your saving goals. You can decide to put aside $500 a month and identify the expenses that you will cut back on to meet that goal. Without a budget plan, you might save only what is left after your expenses are met – which is usually one of the best ways to fail at saving. You have to admit that saving last usually ends up with you having nothing left to save.

It can help you stay out of debt. Since budgeting helps you save, it is one of the best ways for you to stay out of debt. That is because any unexpected expense will not have to be borrowed. You have your savings for that. Not only that, any expense that you will make on your credit card can be included in your budget. That way, you can pay it off at the end of the month and you know your monthly credit limit.

3 Expenses You Should Never Sacrifice In Your Household Budget

frustrated woman with a paper and calculatorIf you believe that budgeting is one way to get out of debt, then you should understand the importance of creating a household budget. A lot of Americans are dealing with debt – some of them are managing credit wisely while others are failing at it.

After the Great Recession, we have come to realize just how important it is to have a budget plan. It can help you control your expenses so you can put aside more money to pay off your debts. The extra money can even be sent towards your savings. It can also help you avoid a lot of financial dilemmas in the future. It can help you understand why you are in a particular financial situation and how you can get out of it.

Why do we need to cut back on our budget

Taking a look at how Americans spend their money is a great way to help us understand our financial habits. According to, the majority of the household budget is spent on food. Now, the majority of our budgets go to housing costs. Among the things that grew in percentage in our budgets include healthcare and entertainment expenses. These details will all be evident in your budget and it is important for you to analyze them so you can determine the changes that you need to make in order to improve your financial situation.

In most cases, people who are forced to use a budget plan are those who have a need to cut back on expenses. The main reason for that is debt. We had to cut back on a lot of things because we need to increase the amount allotted for our debt payments.

In an article entry on, they mentioned a statistic from Experian that revealed the average monthly debt payment of consumers. In 2010, the monthly debt payments of Americans range between $763 to $1,285. If the average household earns between $4,000 to $4,500, their debts take up 20% or so of their income. They only have 80% left to live on. With utilities, food, transportation and other expenses, how can the average American household survive?

This is why a lot of us create our household budget for the purpose of cutting back on expenses.

3 expenses that you should not compromise in your budget plan

But while there are so many things in our usual spending list that we can trim down, there are those that you need to exert caution when trying to cut back on them. There are certain entries in our budget plan that we should never sacrifice.

Healthy meals

The first is healthy and nutritious food. Even if the processed food is cheaper, it is not worth it to risk the health of your family just so you can save a couple of dollars. You still need a well balanced diet and that is something that you should never compromise. If you want to trim your food expenses, you may want to cut back on eating out. These cost a lot more than what you will spend if you cook your meals at home. And when you are out shopping for food, make a list of what you need. That way, you can forecast in your household budget the amount of money that you will need to ensure that your family will eat healthy food always. Here is a video from HowCast about how you can feed your family healthy food even when you are on a tight budget.

Doctor prescriptions

When the doctor prescribes you medicine or treatments that you need to get better, you should not skip on this just so you can trim your household budget. If you have to save, go and ask your doctor to prescribe generic medicines. But do not skip a dosage or take a lower one just so you can save. Get the savings you need elsewhere and not your medications. Your health is a top priority. If you do not take care of it now, it might get worse and cost you more money in the process. One of the best ways to deal with big medical bills is to avoid them by taking care of your body.

Personal hygiene

There are so many things that this can cover. For instance, buying a very cheap make up just so you can save on money and end up getting an allergic reaction is not really the wisest of moves. Proper hygiene is something that you need to be careful with. Try to get deals for toilet papers, and similar products but do not buy nameless brands without making sure if it is safe for you. In the end, it might cost you a healthy body if you sacrifice proper hygiene for the same of making budget cuts.

How to fix your budget plan if it is not working

If you are already implementing a household budget and you realize that things are still not improving, you may need to reconsider your budget plan. Here are 5 steps that you can follow to help fix it.

  1. Track your spending. In most cases, when your household budget is not working, it only means there is something wrong with your expenses. Of course, it always pays to take a look at your income too. Maybe you based your budget expenses on the wrong income. But even if this is the case, you still have to take a look at your expenses. and other authority sites have listed some budget software programs that you can use to track your spending.
  2. Compare your spending with your existing household budget. Once you have tracked your spending, compare it with your budget and see where you are spending a lot of money on. This will help you see where you should cut back on or where you should adjust the amount in your budget.
  3. Analyze why you are overspending. If there is a particular category that you are guilty of overspending, you need to ask yourself why that is so. Is it because you do not have self control? Or is it because you simply made unrealistic cuts in your budget?
  4. Do something to stop overspending. When you have identified the reason why you are overspending on a particular category, you need to correct that or cut back on something else to meet your budget limit. If you are overspending on food because you keep on eating out, then you need to cut back on that and opt for home cooked meals instead. Revise your household budget according to your plans to stop spending beyond what your budget dictates.
  5. Commit to the new plan and observe. Be disciplined in following your new plan and see if it works for you now. If not, then you need to go back to step one and analyze your budget plan once more.

Making your household budget work will involve a lot of changes in your habits. You have to look deep into your financial habits so you can determine if that is what is causing you to fail in your finances. Sometimes, it is not really the debt that is the problem. It is our own behavior when it comes to our money. We need to learn how to change our behavior and that is the only way that we can implement a budget that is effective in improving our financial situation.

4 Benefits Of Budgeting That Goes Beyond Your Income And Expenses

budget on top of moneyIf you really understand budgeting, you will never need an explanation why you have to implement it in your life. Nobody took the time to budget their money and follow it strictly yet still ended up in a financial crisis. No foolproof budget plan will ever lead to your financial demise. If you really want to improve your finances situation, one of the things that you cannot live without is a budget.

Sadly, it seems like Americans are slipping back to our old ways. The effects of the Great Recession included a more cautious American spender that used a budget to keep themselves from overspending. That time seems to have passed.

According to the latest survey from the, majority of the respondents (3 out of 5), revealed that they are not budgeting and keeping track of where they are spending their money. This is one of the habits that got most of us in debt and in a lot of trouble in the mid 2007 to 2008. Those who claim that they are spending less is also declining – which indicates that consumers are increasing their purchases. While this may seem good for an economy that is 70% reliant on consumer spending, that does not really bode well for the average American household.

We are not saying that you should stop spending. We are in a consumerist society. Not spending will be very difficult to do even if that is what you really want to happen. What we really want you to do is to keep on spending but before you do that, you have to seriously implement budgeting in your life. That way, you can easily monitor where your money is really going.

4 ways your budget plan can help your finances

If you need some motivation to get started on your budget plan, you may want to focus on the benefits. There are many positive results to budgeting and it goes beyond just telling you what your income and expenses are. To get you excited, here are 4 ways that a budget plan can help improve your financial management efforts and ultimately, increase your personal net worth.

You can take care of your future self.

Although it might seem far off, you have to believe that every decision that you make today will dictate the life that you will live when you retire. If you have the habit of splurging your income in your youth, your older self will feel the effects of that. A credit card debt that accumulated since your 20s or 30s can haunt you for the next few decades – especially if you decided to pay only the minimum of what you owe. Based on a study done by the Employee Benefit Research Institute and published on, the retirement confidence in 2014 is slightly better compared to 2009 to 2013. But although that is true, there is still 24% of workers who are not confident about their finances when they retire. The study revealed that those who felt confident with retirement are usually those who had a plan in place. If this is your sentiment, then you should realize that budgeting will help you organize your income so you can ensure that your retirement contributions will always be met.

You can plan your spending splurges.

Some people have the wrong idea about budgeting. They think that when they plan their expenses, it will put them in a very restrictive and depriving way of living. This is not true. If you know how a budget works and you can implement it correctly, you will realize that you can splurge on the things that you want and not feel guilty even if it is unnecessary. That is because your budget plan will help you identify the priority expenses and shift other purchases so you can make smart splurges every now and then. That way, buying new clothes or that new camera will give you genuine pleasure because you know that your budget is allowing that purchase.

You can spot spending leaks.

Another benefit of budgeting is it will tell you where you are spending your money in places that you really should not. By seeing these leaks, you can move to seal that off or at least, schedule it so your other priority expenses will not be compromised. A budget plan is usually on a monthly basis. Those $1 or $5 purchases may not seem like much but if you total them, it will show you how it is eating up your finances and compromising your true spending capabilities. Once you have seen the leaks, it will be easier to make the sacrifices that will lead you to stop wasting money on them – like brown bagging your lunch or carpooling.

You can be one step closer to meeting your goals.

Any financial goal, big or small, requires a plan to achieve them. That is how you ensure that you will succeed in achieving the goal. If you want to make managing financial goals easier, that can be accomplished by a clear and foolproof budget plan. Of course, it has to be partnered by implementation but the planning by itself puts you one step forward in reaching your goals. A budget allows you to put aside the necessary contributions needed to make your goals into a reality. It will also help you determine your progress so you can gauge if you need to kick your saving efforts up a notch.

Common pitfalls your budget can save you from

As you are implementing your budgeting efforts, you also have to be aware of the pitfalls that can be averted by following a budget plan. There are three important financial mishaps that it can save you from.

  • Being late on payments. You will never be late again you input all of your debt payments into your budget plan. You do not have to worry about not having the money to pay off a financial obligation because your budget will make sure that you have put aside the contribution for that. But again implementation is the key to never be late on your due dates.
  • Foregoing saving because of too much expenses. revealed that one of the habits that helped selfmade millionaires is their ability to save. You may think that this has no room in your finances because of too much expenses. If you list everything down in a budget plan, you can identify the details that you can remove so you can make way for your savings.
  • Wrong assumption of your financial capabilities. This happens to most of us. We think that we can afford something when in truth, we cannot because there is a more important place for your money other than an impulse buy. Your budget will easily give you an idea about what you can afford to spend and what you cannot. Consult your budget at all times so you can stop overspending once and for all.

Budgeting can really work wonders in your financial life but, as mentioned several times, you have to be disciplined in following it. In case you feel like you budget is very difficult to implement, you might have created an unrealistic one. Do not be afraid to revise it if you have to. In fact, you need to keep on revising this budget plan so you can ensure that it is still aligned with your current financial priorities.

Why Spending Never Works Out The Way You Plan

frustrated looking womanThe lessons learned from the 2008 recession prompted most of us to seriously consider financial planning. One of the things that we kept a close eye on was our spending. In truth, those bad spending habits that we got used to became our financial undoing. We spent beyond our means by using credit cards recklessly and it cost us a lot of money. For some of us, it led to losing some of the assets that we hold dear. It meant letting our homes go into foreclosure, selling our cars and even skipping the usual entertainment expenses that made us really happy.

Thankfully, financial plans can help us curb the bad habits that led to our money’s demise. But be very careful. Even if you create the most promising plan there is, you need to be able to implement it. A lot of us started strong with our plans but unfortunately, not everyone was successful in applying it in their lives.

A plan is necessary to keep your finances under control and this article will try to analyze why your spending never worked out that way you planned it to.

Comparing your budget with your spending plan

In most cases, your spending plan is confused with a budget plan. Some articles actually refer to them as one and the same. But you need to know that they are two separate concepts. Budgeting is the first step towards financial independence and your spending plan will serve as your action plan to connect them.

Here are other concepts that will help you differentiate the two.

  • Spending plans will be more appealing to follow because it does not have the restricting image of a budget plan.

  • Budgets will tell you how much you are allowed to spend for a specific expense category. The spending plans will allow you to control that total amount to satisfy your actual needs.

  • Spending plans can help you detail your wants and needs. A budget plan is more concentrated on your expense categories.

  • Budget plans will help you define what is left for your discretionary income. Spending plans can map out where you discretionary income will go.

More importantly, your spending plan will help define the different patterns that you have in your life. You can see when your housing costs spike and when food prices go up. It can help make your future financial plans more accurate.

Reasons why your plan for monthly expenses is not working

Now that you know how to differentiate a budget from a spending plan, let us identify the possible reason why it can fail you.

It does not include everything. We’ve mentioned how this plan is actually more detailed than your budget. You have to make sure that it includes all the expenses that you usually make. This is how you ensure that it remains true to the restrictions of your budget. You do not want to end up spending more than what you are allowed to. Ideally, your purchase plans cover a period of one month. Make sure that you include your annual and seasonal expenses too.

It failed to indicate your priorities. Another reason why this plan can fail you is when you did not indicate your priorities. This is very important to keep your plan from concentrating too much on the mundane expenses that make you happy. The whole purpose of planning is to ensure that you will not miss out on all your expenses. Put the priorities high on the list and make sure you understand the factors affecting them. In fact, published an article that indicates how every generation usually have different priorities. For instance, Baby Boomers lived after the second World War and it made them heavy spenders compared to other generations. Millennials witnessed how the 2008 recession crippled their parents and grandparents financially, that made them more cautious about credit – especially credit card spending.

It is not realistic. The third reason it is not working is because it is not realistic. You may want to spend a lot on entertainment expenses but when your needs dictate that more funds should be allotted for your debts, then you should reconsider your plan. Based on the data from the Bureau of Labor Statistics ( last March 27, 2013, the average expenses of households depend on the income. The highest 20% allott 30.2% of their income in housing costs while the lowest 20% spend 40% of their income on the same category. In terms of food, the highest 20% spend 11.4% as compared to the lowest that spend 15.8% of their income on this expense. For personal insurance, the lowest 20% spend only 2.1% – which is very low compared to the 16% of the high income earners. Obviously, the low income earners have to forego insurance to pay for more important expenses. Your spending plan should consider all of these to make it realistic and true to your needs.

It is not flexible. Lastly, your plan may not be flexible and that is the reason why it is not working for you. Most spending plans require changes from time to time – just like your budget. As mentioned, your priorities are influenced by a lot of things and this should be something that you consider carefully. As you age, your needs will change and that should prompt you to constantly look at your spending plan to see if it is still workable.

Tips to create a working plan for purchases that compliment your budget

To be a smart spender begins with a well crafted spending plan. Here are some important considerations when you are trying to make this.

  • Base your spending on your net income – not our gross. Nobody ever sees their gross income. If you base it on this amount, you will always fall short and some of your expenses will end up being unpaid.

  • Always analyze your current spending. What you are spending a few months ago may not be the same as what you need right now. Always check if your spending plan is still aligned with your goals.

  • Categorize your expenses to keep the revisions from being tedious. You can put the fixed expenses first as these are the regular payments that you constantly have to make. In most cases, the amount does not change. These include your rent, loan payments, etc. You also have the flexible expenses that are still necessities but vary in amount every month. Your food, groceries and transportation can be placed here. Lastly, you have the discretionary expenses that are the expenses that you do not need to spend on all the time. These can be your clothing, shoes, and entertainment expenses. When you have to revise your plan, you only have to look at the flexible and discretionary expenses.

  • Make sure your income is higher than your expenses. If not, you will always have to spend some credit to take care of everything. That defeats the purpose of using this financial plan. Trade off some of the expenses that you can live without so you can afford those that you need to spend on. shows that the average household income is at $43,000. With the rising cost of living, this is just enough for a family of 4 to live on. If you want to make your spending less restrictive, you should consider earning more or cutting back. The bottom line is to make sure that you can control where your money goes and the plan that will help you achieve that is something that you can follow consistently. If it is not working for you, review the plan to see if it requires you to make some changes.

Here is a video created by National Debt Relief to help you learn how to budget for your household.

5 Ways A Frugal Budget Can Help You

woman showing her handPeople have been trying to change into a frugal lifestyle but unfortunately, it is not always successful. A lot of them try to make it work but it is just something that they cannot accept. Changing from extravagance to frugality is not the easiest transition to make and you may find yourself fighting it all the way.

It is true that living on a frugal budget is tough, but there are circumstances when it proves to be very beneficial. Aside from helping you reach your financial goals, you can benefit from various lessons that it can teach you. It just takes a certain level of commitment and discipline to make the change bearable.

5 lessons you can learn from frugal living

It could help you accept this necessary change if you know and understand what you can get out of it. Sometimes, the sacrifices are easier to do if you know that the frugal budget can benefit you. Most of what you will learn can help you practice the right money management skills. Here are 5 specific lessons that you can get out of following a frugal budget.

  • It teaches you how to get through financial hardships. We all know that what you do not have will not be missed and this is the key to help you survive a financial crisis. Frugality will teach you to live without extravagance and when you get used to this, you do not have to change a lot when another financial difficulty strikes. You can continue living the way you used to and your life will not be as miserable as the others. It is different if you downgrade your lifestyle by choice than by force.

  • It prompts you to be wiser when it comes to your financial transactions. As you are implementing your frugal budget, you find more reason to think about every financial transaction that you have to make. People think that to be successful at frugality means depriving yourself. This is not true. You do not have to deprive yourself of anything. On the contrary, you simply have to decide which of the expenses you used to make are more important to you. That is where you should allot your limited resources.

  • It helps you get out of debt. Some people start on a frugal budget because they have a lot of credit obligations. Frugal living will help you increase your disposable income so that you can put more money into your debt payments. By prioritizing your expenses through your new budget, you get to identify those that you can eliminate to make way for your monthly debt contributions.

  • It encourages you to develop the right financial management skills. By being frugal, you are taught to be a smart spender and you know that you have to adapt a frugal budget. These are the skills that will help you stay out of debt. You will even learn how to save your money so that you can grow your investment abilities. That is what will lead you towards the growth of your finances.

  • It pushes you to be resourceful and creative. We have mentioned how frugality is not about deprivation. Instead of spending for something, you have to be resourceful to find another way to satisfy your needs while being economical about it. If your family loves bread, you can learn how to bake one. That comes out a lot cheaper. You can learn how to be patient to use coupons. These are the things that you need to learn.

How to make frugality more appealing

Admittedly, if your heart is not set on your frugal budget, it will be very difficult to implement. It takes some getting used to but there are some tasks that you can do to help make the lifestyle shift all the more smooth. So to help you adjust, here are 3 things that we want you to do.

  • Have a goal. A goal is necessary especially when you know that you have to make a couple of sacrifices. It is the psychological way of setting up for yourself a motivational tool. Whenever you feel like your frugal budget is too hard to follow, you simply have to look back on this goal to remind yourself why you decided to go through this in the first place.

  • Change your mindset. Like it or not, you have to change your mindset about frugality. We hope that the 5 lessons we mentioned above will help you. But beyond that, you need to read about success stories about those turning to frugal living to help them improve their way of life. It is not about being cheap. You have to get rid of your misconceptions so you can truly believe that frugality is the right lifestyle for you. If you believe it enough, you will adapt to it.

  • Know what is important to you. We’ve mentioned many times how deprivation is not what you should get with frugality. It is true that you have to lower your cost of living but that does not mean you have to let go of what is important to you. On the contrary, you have to identify what is important so you can prioritize it. That way, you can spend on them and still stick to your frugal budget.

You have to keep in mind that frugality does not have to eliminate the fun things from you life. You just have to learn how to manage your money well. Try it out with a frugal budget by looking at these templates from In fact, the site has an interesting heading on it: plan, simplify, save and thrive. That pretty much sums how frugality is to be done.

Here is a video from National Debt Relief that tells you how you can make a budget.

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