June 28th, 2018
With dependable monthly rent, included amenities, no seasonal chores, no extra maintenance, and no responsibility for repairs, apartment life can make budgeting easy. But did you know that living within a budget can make apartment life even more enjoyable? The goal of a budget is to give you more financial freedom, not to take it away. So, try these budgeting tips to enjoy more of what apartment life already gives you.
List the fixed-amount bills you pay every month and their amounts—things like rent, car payment, phone bill, and so on. At that point, start making educated guesses about where the rest goes. But remember you are not carving these numbers into stone. Don’t avoid creating a budget because you don’t know what numbers to include. Start with estimates and adjust as you go. No matter how far off you are, you’re still in better shape than you were without a budget.
Now it’s time to gather the data that will help you improve your estimates. This is where a lot of would-be budgeters fall short, because it’s an extra step that’s easy to forget if you’re not already in the habit of tracking your spending. But there are abundant budgeting tips (and technology) to help you find the tool that works. Look for spending apps you can use on your phone. If you keep a paper diary, jot down expenses when you’ve finished a run of errands. Collect receipts through the day and take a few minutes at night to enter them. Or let the money itself tell you how you’re doing: put cash in categorized envelopes and just look in the envelope to see where you stand. As long as you do it, the tool doesn’t matter.
Now look at what happened last month. Did your money go where you wanted? Did you spend in ways you now wish you hadn’t? This is the time to recognize the difference between wants and needs. We often want things that are right in front of us, but that have no lasting value. Creating line items for discretionary and entertainment spending is essential to your quality of life. But when the spending in those categories isn’t a conscious decision it’s less likely that you’ll get the full benefit of treating yourself to things you love.
Budgeting tips are all about delivering you to a state of financial peace of mind, so if you’re focused entirely on day-to-day spending you’ll never get there. Create a line item for savings and make it a top priority, no matter how small the amount might be. This is where you pay yourself. Create categories for expenses and bills that come up repeatedly but not monthly, such as taxes, semi-annual insurance premiums, regular auto maintenance, school shopping, Christmas, etc. Create an emergency fund as well. No, you don’t know what the emergency will be or how much it will cost ahead of time, but worst case, having something set aside is better than nothing. Best case, you might even see extra money accumulate there.
When you have a budget you can rely on, you can really enjoy your leisure activities and expenditures, rather than feel a dark cloud of financial anxiety hanging over you the whole time. This article has more helpful budgeting tips and links to help you build a budget that works. When you have one, you’ll enjoy the ultimate freedom of apartment life: time that’s yours to enjoy to the fullest.