As we all certainly know, time is merciless in its march into the future. And at this time of year, especially, we are cognizant of the new year ahead.
In addition to filling our gyms beyond capacity on January 2nd, many of us choose to tone up our wallets, usually in the form of a do-or-die budget. But budgeting does not need to be perfect. In fact, the people who allow themselves greater flexibility with their spending plans are the ones who have the best chance of success.
- Create Monthly Spending Plans: Many people abandon their budgets because sticking to them seems overwhelming. I have found that the people who get overwhelmed are planning year-to-year. Instead, my advice is to budget month-to-month in order to maintain a better grasp of what you are spending.
- K.I.S.S.: When creating a spending plan for 2016, keep it simple. Creating a plan that is overly detailed makes it much more likely to become an abstract concept rather than something practical.
- Easy Fixes: When tracking your progress in adhering to your spending plan, remember that being flexible also allows you to adjust, completely change, or delete aspects that have shown themselves to be unrealistic – the biggest threat to any spending plan is having items that you continually ignore or forget about.
- Baby Steps: Let’s be honest: No one really wants to spend less money, just like no one really wants to cut the lawn. A friend of mine was recently telling me how he made lowering his expenditures easier, just by changing his mindset. He said that just the idea of saving money influenced the way he spends, and according to him, it was effortless. In other words, he took baby steps toward accomplishing his goal, and it had a real impact. Never underestimate the power of baby steps!
- Take Advantage of Your Credit Card(s): Credit cards are great for emergency expenses and many offer detailed reporting, as well. For example, Discover includes your credit rating with every statement – without negatively affecting your credit.
- Use Cash: Yes, cash still exists, and yes, stores still accept it. One piece of advice I give to people who are trying to rein in their holiday spending is to make an envelope with each person’s name on it, and stuff it full of cash…but only the cash you want to spend. Then you can leave your credit cards at home and be proud of your restraint.
The takeaway is simply to be realistic. Make sure your spending plan reflects your lifestyle, cut yourself some slack, and take a long-term view of your finances. Do your budgeting in a way that is suited to your personality and capabilities. And know that falling off your horse and getting back on it is a time-honored tradition shared by most successful people!