Personal budget strategies in a rising cost environment

Managing a personal budget in a normal economy can be challenging. Sticking to a budget in a rising cost economy can be daunting and overwhelming.  While many people are aware it is important to have a budget for your household, during a high cost, high inflation economy it’s not only important, it’s a non-negotiable.

Below are five budget strategies you can do starting today to help you manage through a high cost economy.

Track your spending

This can be done with something as simple as an excel spreadsheet or a budgeting app on your smart phone. Tracking your spending allows you to keep an eye on where your money is going. Take it a step further and categorize your expenses such as gas and groceries to identify areas you can cut back on.

Automate savings

Set up automatic transfers from your checking account to your savings account on payday. Small consistent contributions to your savings account each month will add up in no time and help you build a cushion.

Prioritize needs over wants

Focus on essential expenses, such as your mortgage and utilities and groceries. Think outside the box, if you normally shop for your groceries at a certain place, is there a less expensive grocery store option? Limit your spending on non-essential items temporarily.

Reduce debt

Credit cards have notoriously high interest rates when you carry a balance on them. If you use one, pay it off right away or at least before the end of the month. A great way to use a credit card is to think of it like a debit card. When you swipe the credit card, immediately go into your online banking and either pay it off right away or set aside that money in a separate account for when the monthly bill arrives. 

Look for discounts and deals

Take advantage of coupons and loyalty reward programs. Buying in bulk at warehouse clubs such as Costco or Sam’s Club can help you save money on every day items. 

Remember, do not get discouraged. There are no perfect budgets, and everyone’s personal finances are slightly unique. There are certain budget truths that have withstood the test of time. Think small and consistent; small amounts add up overtime, and consistent, regular contributions to your savings account will help you build a nest egg for the future.  These are behaviors we can all adopt now to bring future personal wealth and prosperity.