Setting goals is an important part of life.  If you don’t set goals you’re bound to end up in random places–this goes for your money too!  Having goals can help us stay on track.  Many times we need a reason WHY we’re setting goals.  When it comes to budgeting, we’re simply trying to manage our money–know where it’s going and getting control of it.

Another important aspect of setting goals is to set a timeline or deadline to them.  So with each of these goals, I urge you to set up time frames in which you will accomplish them.

If you’ve never set up a budget or are getting back into it, here are some goals to start off with:

1.  Setting Up Your Budget

Your first goal should definitely be to set your budget up.  Break out your pen and paper, spreadsheets, budgeting software, bank statements, pay stubs, calculator etc. and get to writing!  If you need help with how to start, check out Life Skill: Budgeting – The Baby Step Budget – it includes a few budgeting goals there too!  *Complete this goal by the end of the day!

2.  Assign Every Penny

After you’ve set up your budget, you may learn that, if you’ve give yourself parameters in certain flexible expenses (i.e. groceries, entertainment, savings, etc.), you actually have some leftover money.  If this is the case, you absolutely must find a place in your budget for it.  I suggest checking your budget to make sure everything is accounted for and if you still have money leftover, put that money where it’ll be the most beneficial–usually savings, but sometimes entertainment/spending money too.  You’ve got to have SOME fun.

3.  Follow Your Budget

Essentially, this means sticking to it.  Why do all the work of setting up a budget and not abide by it?  It’ll take a few months to really get the hang of it, but if you commit to this goal you should be just fine! Try to remind yourself daily WHY you need a budget and, if need be, remind yourself what happens when you don’t.  I guarantee you’ll find out soon enough if you stray too far and/or too often.

4.  Record Your Expenses

Once you’ve set your budget up, you must be determined to record your expenses DAILY!  Every time you spend, find the expense in your budget it goes under and take it (subtract it) from that category.  This will help ensure you don’t overspend.  The easiest way to do this is by setting up your budget in a software that has a mobile app.  Take your phone out the minute you make a purchase (or before driving off to your next destination), and input the amount you just spent under the correct expense category.  You can also do this at the end of each day if you’re doing the paper and pen method.

5.  Track Your Expenses

To do this, you’re going to want to keep a record of your budgets.  Again, the easiest way to do this is if you use some kind of software or spreadsheet.  If you’re doing the paper and pen method, DO NOT throw it away!  Keep it in a safe place or on you at all times (this can help deduct expenses when you spend too!).  At least ONCE A MONTH you want to take a look at your spending.  This isn’t the same as just subtracting your expenses, this is more like investigating.  You’ll get a better idea of your spending habits.  You may not be able to change the amount of money coming in, but you can certainly figure out a way to change your spending.  The whole purpose of a budget is to figure out HOW TO SPEND LESS MONEY THAN YOU ARE MAKING!

6.  Balance Your Budget NOT Your Checkbook

I’m sort of kidding.  You always want to check your account balance to make sure nothing crazy is going on and that you, indeed, have the money you’ve budgeted for.  Also, you want to keep track of any fees your bank may charge you for–include these in your budget!  However, you really want to get into the habit of checking your budget because that’s the money you’re working with.  Instead of checking to see how much money you have in the bank when you’re about to make a decision on spending, CHECK YOUR BUDGET–specifically the expense under which the spending falls.  Your checking account will tell you how much money you have overall, but your budget will tell you how much money you have to spend.

7.  Savings as an Expense

In your budget, make it a goal to include savings as one of your expenses.  Even if you can only put $1–it doesn’t matter, EVERY PENNY COUNTS.  Savings is a necessary expense.  Having that mindset should be a goal.  At first, any money set here (which should be ANY EXTRA not being spent anywhere else) should go towards DEBT!  Once you’ve gotten the hang of budgeting you’ll be able to create more interesting savings goals.

8.  Cutting Expenses

If you’ve been recording and tracking your expenses regularly, you’ll be able to see where you’re money is going.  You want to get to a place where you’re able to start SAVING MONEY.  The fastest way to do that is by taking away from some of your biggest expense categories.  Some of the easiest categories to cut back on are groceries, entertainment, and transportation.  You can even do some research on how to cut back on your utility bills and debts (it usually only takes a phone call to negotiate a new deal with creditors)!  I suggest attempting to cut back on ONE expense at a time. You want to be able to tweak your budget, but you also don’t want to get so frustrated that you give up all together.  Most of us can get so upset that we get the F its and go on a spree!  We want to avoid this!

9.  Getting Out of Debt

This goal could take awhile, however, if you really stick to your budget it will happen a LOT faster.  Always make sure your necessities are met, but if you’ve set SAVINGS AS AN EXPENSE, you can use this money to pay off debt.  We tend to splurge, but if you want your debt to be paid off more quickly, instead of getting that new pair of shoes or cup o’ joe, send it to a debtor.

10.  Save MORE This Year

The ultimate goal is to put more into your savings account than you did last year.  However, if you’ve got debt, pay that off first.  There’s no sense in saving money while your interest builds more than your income.  Once your debt is paid off you can set specific savings goals for a number of different things, like a retirement or emergency funds, a home, a car, etc.

Well, there you have it.  Some goals to help you get started and motivated to bigger and better things!  Start with one and work your way towards the next!

Don’t forget to tell me what you think or ask me any questions below!

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