When it comes to your budget, you should update it often so that you can make sure that your budget aligns with price increases and extra financial commitments you may have taken on. It’s time to take another look at your finances and make sure your budget is up to date.
Re-evaluate Your Expenses
There could be a number of things relating to your finances that may have changed recently. For instance, you may have received an annual pay rise or there could have been an increase in petrol prices, insurance premiums etc. or you may have debt that you are paying off. These type of things can result in either a gain or a reduction in your disposable income. If you have had a change in your finances, then your list of expenses will no longer be the same.
You should then make a new list of your expenses which include your monthly necessities as well as personal loans, credit card debt etc. that you might be paying for. Also, make sure that if any of your expenses have increased in price that you have made the necessary adjustments. Deduct these expenses from your salary and you can determine if your budget is working or not.
If you find that you have a reduction in expenses, then you could put a bit more money into paying off debt or into your savings. If you find that you are paying for more things, then you may need to see where you are able to make cutbacks and readjust for the increases in expenses.
You need to make sure that you have included every financial aspect into your budget so that it is true to your lifestyle.
Check Your Insurance
You should go through your various insurance policies like car insurance, home contents insurance etc. and see if what you are paying is still providing you with the cover you need. If you have bought a new car recently then you should notify your insurance provider and update your details so that you have the right cover.
The same is true if you have bought a new home or have added to your home contents as your premium may change to accommodate these changes. You need to make sure that your home is not over or underinsured.
Also, it is a good idea to compare new insurance quotes from providers to ensure that you are still getting the best deal with the right cover for you. You may find that you are able to save a little each month on premiums by doing this once in a while.
Keep reading for more ways that you can clean up your budget…
Watch What You Spend
Keeping track of your budget is easier than ever nowadays with apps that do it for you. Spending money can get out of hand when you don’t have a budget or a way to track your spending. With tracking apps, you can record what you spend.
When you track what you spend, you can make sure that you stay on budget and are not overindulging, especially when you just get paid.
Check Your Credit Report
Once a year, you are entitled to a free credit report from the credit bureau. You may not think that you are in financial trouble, there is a possibility that a default or a judgement is present on your name that you are not aware of, there could be mistakes in your credit report that you should get fixed right away or someone may have fraudulently taken out credit in your name.
You should review your credit report and make sure everything is in order.
Get to Know Your Real Debt
When it comes to debt it can be easy for us to avoid it even though we are accumulating debt from different providers. You may think that you don’t really owe that much, but when you add up your credit card debt, store accounts, loans etc. you may find that it is actually a lot more than you thought.
You should review your debt often and have a plan in place to pay off your debt and avoid taking on more debt. Your debt repayment plan should form part of your budget so you know exactly what you will have as disposable income after everything has been paid.
Check Your Bank Charges
Every year your bank may increase their charges, so you should have a look at what your accounts are costing you. You should see if they offer better priced products that suit your needs. Also, assess if the accounts you have offer benefits that you are actually using and get rid of any accounts that you don’t use or need that are costing you money.
Having a monthly budget is important and you will need to review your budget every once in a while and ensure that it still aligns with your expenses, your debt repayments and your lifestyle.