Before making a budget plan, Andrea Woroch, consumer and money-saving expert, emphasized the importance of understanding much you spend each month on various things. “To determine this, it’s important to identify your budget baseline by tracking your spending for a few months,” she says. This way you know how much goes toward rent or mortgage, transportation, food, utilities, shopping, etc. Through this process, you will also be able to identify areas where you typically overspend. “Ultimately, this makes you more aware of your spending and saving habits to help you make better choices.” Try following these money-saving tips of great savers.
Use technology to your advantage
If you’re not sure where to start, try a smartphone app, suggests Justin Lavelle, Chief Communications Officer of Know Thy Customer, whose mission is to give companies more and better customer data. “If you have no idea how to make a budget or you get frustrated with the details, there are many apps that can help,” he says. He recommends Mint, a budgeting and finance app. “It actually connects with your bank accounts and over a period of time, it uses the data from your spending habits to offer ideas or set up a complete budget for you.”
Give each dollar a job
If a thorough app like Mint doesn’t work for you, Lavelle also likes You Need A Budget, which helps you assign a certain job for each dollar you have. “It is a bit more interactive, but it can really help you learn where each dollar is going and gives you the ability to see how you spend your money,” he says. Once you see just how much you spend on that morning coffee, you may decide to make some changes.”