Save Here, Spend There: How to Live Well on a Budget.

Hi friends,

Am sure many of us would have been thinking on better ways to live within our budget and still be happy. Many people have a negative perception of living on a budget. They believe that keeping track of their expenses and budgeting means never having any fun and living a life of austerity, feeling guilty for each penny spent. However, this couldn’t be further from the truth.

Being able to keep track of and manage your expenses with a budget doesn’t mean sacrificing all fun; it means allocating your money in a better way so that you can reduce your cash-flow stress and
enjoy more freedom. It means examining where you are spending money unnecessarily and instead, using that money to build your savings or enjoy something else you want more.
By creating a budget and figuring out how to spend your resources wisely, you will free up cash that you can invest in other ways and also allow yourself to build up some savings which you can rely on in an emergency.

  Give Yourself Some Money to Spend
 Living on a budget that is too austere will not work well for very long. Allowing yourself too little money is like allowing yourself too little food on a very strict diet — eventually you break and eat (or spend) way more than you intended. This sort of restriction is not realistic or balanced. Restricting yourself to a tight budget will soon leave you feeling depressed and deprived and your social life will suffer.It is necessary to allow for some “fun money” in your budget so that you can maintain a balanced lifestyle. Make a reasonable monthly budget for the activities that you like to do, such as having lunch with your best friend, going out dancing or attending the theatre. If you love to travel, allow enough extra in your yearly budget for a trip or two. Even if it’s just a short jaunt or a weekend away to a hotel in a neighbouring city, there are several vacation packages available online that are actually quite reasonable, and giving yourself some time away is a great way to recharge your batteries. As long as you stay within your budget, you can — and should — still have some fun.

 Create a Budget for Larger Expenses
When you are saving up for a large expense such as a new television, a car or even a down payment on a house, the large sum can seem quite intimidating at first. Making a written plan will help you to determine how much you will need to save each month and how long it should take you to reach your goal. By allowing yourself some time to save money and work toward your goal, you should still have enough to live reasonably within your budget and still reach your goal to make a major purchase. Keep track of your savings on a chart and make a note of your progress, as it is very encouraging to see how far you have come.

Live Within Your Means
 This piece of advice seems painfully obvious: don’t spend money you don’t have. Unfortunately there are millions of people trapped in debt because they didn’t follow this simple rule.
Debt can be a helpful tool and getting yourself into debt by getting a loan is sometimes the only way to buy something, such as a house. But don’t forget that every penny you borrow will have to be paid back, plus interest. Any purchase should be made with a clear plan of how you will pay any borrowed money back. Avoid the mistake of using your credit card to finance the purchase of flashy new clothes and electronics only to be sentenced to huge monthly payments in the future that you can’t afford to pay off.Buy what you need, when you need it, only if you can afford it.

Who Cares About the Joneses?

In addition to this, be wise with your large expenses such as your car, house and electronics. Don’t feel like you have to compete with what your neighbours have or with what you think society wants you to have, such as the large house in the suburbs or the big screen TV. Forget about “keeping up with the Joneses” or anyone else and choose what fits well for your budget and your family.

Keep these tips in mind and you will be sure to live well on a budget and enjoy financial freedom for many years to come.

Credit: Kayla Sharp.