Do you know the types of budgeting systems that suit your finances? With COVID and everything that’s happening lately, it’s OK for your finances to be a little bit out of control, life has changed dramatically and we’re still adjusting to it. Lots of us have found our income on pause or other circumstances have eaten into our budget, or maybe you’re just ordering in more since you’re staying at home. It’s totally normal, firstly don’t beat yourself up about it. Now, it’s time to get your finances in order with these money management systems!
1. Give Yourself Credit
The Give Yourself Credit journal has been specifically designed to help you manage out of control finances. You can really go through your incomings and outgoings, set yourself some savings goals, create a wishlist, learn to budget, and figure out which categories you spend the most in. Getting to the bottom of your finances with a pen and this journal is actually the best way to get in control of your finances.
2. The 50/30/20 rule
This is one of the most popular types of budgeting systems. The 50/30/20 rule helps you break down exactly what percentage of your income you should be spending on wants, needs, and savings. It’s also explained in detail in the Give Yourself Credit journal. So, the first 50% of your income goes towards the things you need, then 30% goes towards things you want, and the last 20% goes towards savings and debt payments. Living by this rule can help you get in control of your finances. Figure out if you’re spending too much in one category and adjust accordingly!
3. The envelope system
If you’re one of those people that occasionally dip into their savings, you need an intervention to leave that money alone. The envelope system allows you to take out the money you budget and put it in different labeled envelopes, limiting your use of a card. If that’s all you have, you have to pay with cash and that’s the cash you have on hand. Obviously, nowadays card payments are preferred as it’s just safer, so to flip this on its head, you could take out a small amount of money you want to save that month and put it in an envelope or safe – add to it every month and then deposit it back into an account when the time is right.
4. The zero-based budget
The zero-based budget means every pound or dollar gets a job. If you tend to overspend or don’t take too much notice of the categories you should be using, you need to give every bit of money a ‘job’. You won’t tell yourself that you have money to spend if you know it’s going towards something else, so start allocating your finances now.