William Reynard Provides Tips for a Successful Budget
Creating a successful budget can be a daunting task, but it can be quite simple if you know what to keep in mind along the way. Over the course of William Reynard’s career in the financial sector, he has helped individuals of all walks of life develop useful skills for budgeting that will serve them throughout their lifetime. Here, William Reynard provides insights on a few of his favorite tips for creating a successful budget to manage their finances.
Keep Your Financial Goals in Mind
Budgets exist as a tool to help us reach our financial goals through proper management of our funds. For this reason, it is important to think about your goals during the first steps of creating a budget. Whether your goals are to purchase property, pay down debts, save up for a wedding, or start a family, knowing what you are planning for in the future is crucial for how you should look to manage your funds today. If you are budgeting with your partner, it helps to make sure you are both on the same page with your budgeting and goals early on as it will ensure that you are both taking the proper steps to setting up your future.
Monitor Your Spending
Budgets are always going to be more successful when we are aware of how much we are spending each month. Monitoring your spending through a mobile banking app or other financial resource can help you make note of how much you should be allocating to specific areas of your budget when you are in the beginning stages of crafting one. Another benefit of monitoring your spending is that it can reveal smaller transactions that add up but may be unaccounted for otherwise. As people get a clearer understanding of their spending habits in relation to their income, they will likely not need to pay such meticulous attention to their transactions. Until these habits are recognized and kept track of through a proper budget, however, tracking your transactions is a great plan.
Know Your Income
Creating a budget is always easier when you start by determining your take home pay, after tax, each month. This helps provide a blueprint that will keep your calculations for your budget accurate, keeping you from overspending on any one specific area of your budget. Don’t worry if your income tends to vary from check to check, just try to get the most accurate average that you can. If you have multiple streams of income, try to make sure that they are all accounted for to get the most accurate representation of your monthly income.
Calculate your Expenses
William Reynard notes that calculating expenses can be one of the most difficult parts of creating a budget, but it can be streamlined and simplified if you take your time and leave no stone unturned. The best way to start is to ensure that the most important aspects of your life are included in your expenses including housing, food, and transportation. Try to be honest with yourself about your spending and account for entertainment and other extra accumulated costs such as hobbies as well. The better you can calculate your expenses the more useful your budget will be, so try to estimate your expenses as well as you can. Remember that a budget needs to be workable and- if you find that you may have miscalculated- you can always go back and change things.
The point of your budgeting is to save each month to help you reach your financial goals. Paying yourself first by saving is, therefore, one of the most effective strategies to be sure that you will have money left over by taking advantage of behavioral finance. William Reynard recognizes that we are much less likely to spend money after we have gone through the effort of putting it away, so consider saving first and only touching the money if there is an emergency. Some new budgeters make the mistake of saving after they accumulated expenses over the course of the month. In these scenarios there is often no money left to devote to savings- which, over time, can keep an individual from successfully reaching their financial goals.