Budgeting can seem daunting, especially if you’re new to managing your finances. But it doesn’t have to be a stressful experience! With the right approach, budgeting can actually be an empowering tool to help you take control of your money and achieve your financial goals. In this blog post, we’ll walk you through the basics of budgeting categories, the types of budgets you should consider, and how budgeting can help you save money. Plus, we’ll introduce you to Brigit’s tools, which can help you keep an eye on your spending and stick to your budget.
Types of budgets and how they work
Before we dive into budgeting categories, let’s talk about the different types of budgets you can use. There are several options, including:
- Zero-based budgeting: With this method, you start from scratch each month and assign every dollar you earn to a specific category or expense. This helps you make sure you’re not overspending in one area at the expense of another.
- 50/30/20 budgeting: This popular budgeting method divides your income into three categories: 50% for necessities, 30% for discretionary spending, and 20% for savings and debt repayment.
- Envelope budgeting: This method involves putting cash into different envelopes for different expenses, such as groceries, entertainment, and transportation. You can only spend what’s in each envelope, which helps you stay on track.
Whichever budgeting method you choose, it’s important to find one that works for your lifestyle and financial situation. It may take some trial and error to figure out what works best for you.
Budgeting categories to consider
When it comes to budgeting categories, there are a few key areas you should consider. These include:
- Housing: This includes your rent or mortgage payment, utilities, and any maintenance costs.
- Transportation: This includes your car payment, insurance, gas, and maintenance costs.
- Food: This includes groceries, dining out, and any snacks or beverages you purchase.
- Debt: This includes any credit card payments, student loans, or other loans you may have.
- Entertainment: This includes any non-essential spending, such as going to the movies or buying a new video game.
- Savings: This includes any money you’re putting away for your emergency fund, retirement, or other long-term goals.
It’s important to think carefully about what categories you need to include in your budget.
How budgeting can help you save money
Budgeting can be a powerful tool to help you save money and achieve your financial goals. Here are just a few ways budgeting can benefit you:
- It helps you identify areas where you’re overspending: When you track your spending, you can see where your money is going and identify any areas where you’re overspending. This can help you make adjustments and cut back on unnecessary expenses.
- It helps you plan for the future: By setting financial goals and creating a budget, you can start to plan for the future. Whether you’re saving up for a down payment on a house or planning a big trip, budgeting can help you get there.
- It reduces financial stress: When you have a plan for your money, you’ll likely feel less stressed and anxious about your finances. This can help you sleep better at night and feel more confident about your financial future.
Using Brigit’s tools to keep an eye on your spending
Managing your finances can be challenging, especially when you’re dealing with unexpected expenses or irregular income. That’s where Brigit’s tools come in. Brigit is a financial app that offers a range of tools and resources to help you stay on top of your finances and achieve your financial goals.
Here are some of Brigit’s tools to help you manage your finances, including:
- Balance notifications: Brigit can send you alerts when your bank account balance is getting low, which can help you avoid overdraft fees.
- Income tracker: Brigit can track your income and help you predict your cash flow, which can be especially helpful if you’re dealing with irregular income.
- Bill reminders: Brigit allows you to see when your bills are due, which can help you avoid late fees and missed payments.