We’ve all heard the sage old advice: save your money for a rainy day. These days, rainy days come in many different forms. Whether it’s a car accident, medical emergency or a major home repair, any of these situations can occur without notice. Instead of stressing out and scrambling for that extra cash, plan a home budget. You won’t realize its importance until that one day when it starts to pour.
Be Prepared for the Unexpected
It sounds like an oxymoron but you can prepare, at least financially, for those unexpected events, like huge medical bills or a job loss. To see how much money you spend (or waste) every month, write down every monthly expense – from car payments and rent to shopping sprees and weekly lattes. It helps to keep your receipts and review them every so often to get a reality check for how much money you really spend. If you have a hard time remembering all those bills, check out websites like Kiplinger for a budget planning worksheet. These worksheets will clearly point out where your money goes and where you can pinch and save. Come up with a plan like saving 10 percent of your paycheck or cutting back on mani/pedis to boost your savings.
Everybody’s Working for the Weekend
You work hard and now that it’s the end of the week you want to play hard too. Remember, having a home budget doesn’t mean you can’t do anything fun. Go out for happy hour without worrying about spending the cash you need to pay the electricity bill. With a planned home budget, you will know how much leftover cash you have to spend on that Friday night martini or thick, delicious steak without any buyer’s remorse.
Time to get away
We all dream of lavish cruises, extended vacations and coastal getaways. But we may feel like we just don’t have the funds to support such an expensive trip. With a home budget, you will be able to plan for that trip to Aruba or a weekend away up in the mountains. First, figure out how much it will cost for your getaway, including travel, lodging, food expenses and extra spending money. Then, look at your home budget and see what you can cut back on in order to save that much money over time.
Time to Retire
Yes, retirement isn’t something you think about every day but one day you’re going to be old (if you're lucky). A home budget plan helps you prepare for the days when you won’t be working any longer. To learn more about how much to save for retirement, contact your local bank, 401k provider or check financial planning websites like Charles Schwab or CNN Money for information on how to get started and plan your home budget accordingly.
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