Everyone has their own reason for starting a budget, but everyone who implements and sticks to a budget usually has a shared goal in mind: to save more money. If you haven’t been sticking to a budget, the following are some examples of common situations that might prompt you to reevaluate your spending habits:
Marital status changes
Getting married or divorced means a huge lifestyle change, and your finances will most likely change. For example, you might be a double income household now, or you might be one household less. You might need to pay child support payments, or maybe you’re receiving alimony payments. No matter what the situation is, you’ll probably want to start a budget if your marital status changes, or modify the current budget you already have.
You want to make a large purchase
Many people don’t start a budget until they have a very specific goal they want to work towards. One common goal is a large purchase, such as a home or a car. Whether you need a down payment to qualify for a loan or you’re making your purchase in cash, creating a budget is often the first step at saving up the money you need in a time-efficient manner. With a budget, you can find out where your money is going each month, where you can cut costs, and how much you can realistically save up within a certain timeframe.
You lost a job
You may have done okay without a budget set in place prior to losing a job, but without a steady income flow, budgeting could be helpful. If you’re in between jobs or you’ve had to accept a different job with lower pay, creating a budget can help make bills easier to manage and keep track of.
You’re having a baby
An addition to the family will also usually change the way you save and spend money. If you’re expecting a baby and haven’t had a budget before, it could be a good time to create one. Your budget would include the new expenses you’ll soon be facing as a parent, in addition to saving for the future (i.e. a college fund).
You’re in a lot of debt
If you’re barely making a dent in your debt, you might want to consider starting a budget. In fact, many people start a budget because they want to tackle their debt, and those minimum payments just aren’t cutting it. By creating a budget, you can cut down on unnecessary spending and use that extra cash to help pay down your balances.
You want to make an investment
Whether you want to make an actual investment or invest in your future—for example, go to college or start your own business—you might need to save up enough money to make your goals possible. Many times, people in this situation will create a budget so that they can reach their money-savings goal as soon as possible, and potentially without needing a loan.
To be continued: For now, we’d love to hear your feedback—what changes in your life made you decide it was time to create a budget?
And if you could use some extra cash to catch up on bills and expenses (which could make it easier to stick to a budget), as always, Peachtree Financial Solutions is here to help. If you’re the recipient of a long-term payment stream, Peachtree may be able to purchase some or all of your periodic structured settlement payments. There are several advantages to receiving your money sooner, and we’d be happy to help you reach your goals. Contact Peachtree Financial Solutions today!
Nothing above is meant to provide financial, tax, or legal advice. You should meet with appropriate professionals for such services.