Make Your Budget A Moving Target

Wed May 19, 2010, 1:00 am | 1 Comment

It is essential to make a budget and stick to it, but by making saving and spending a moving target. The budget will keep your spending in check. When you categorize saving and spending, don’t force yourself to fully abide by your own rules. One of the best ways is to put a maximum on spending and a minimum on saving.

It so happens that you almost always feel you have to spend every penny that you budget for each of your spending categories. But you must not feel obligated – for the lack of a better word – that you have to spend the money that you have allocated in each month. Instead try to save [and not spend] what you don’t spend [did I say that right?] In that case, your spending becomes a moving target.

Example

Let’s say you have allocated $100 each week for groceries but for some reason, you don’t get to spend the $100. Don’t pressure yourself by making excuses that you have to spend the rest on something that you actually can do without.

Strategy

Set spending limits in different categories. Then experiment with lower levels of spending until you reach a level that is uncomfortable for you. When that happens, you can increase your spending a little.

In a Nutshell
Don’t force yourself to spend what you don’t spend in a month. Instead save the extra money. You will be glad you did.

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