You’ve got bills coming up, and you were relying on that tax refund to be enough to cover them – but it wasn’t.
You expected a much bigger tax return than you got, which now means that you’ve got to figure out how to stick within a much tighter budget. While you may not have been prepared for this, there are ways to make a living within a budget a lot less stressful.
Let’s take a look at how you can cut your expenses without having to sacrifice your needs and live within your budget.
1. Know Your Incomings and Outgoings
The first thing you need to do if you’re learning to live on a budget is to know what’s coming in and what’s going out of the bank account each week.
We recommend making a list of all the different ways you have money coming in, whether it’s your job, a side job or even the pension.
Once you’ve done this, make a list of every bill you pay, whether it’s weekly or monthly. Come up with the total and subtract this from your income. This is what you have left to work with, and now that you know the exact amount, you’ll find it a lot easier to stick to it.
2. Differentiate Needs and Wants
When it comes to spending money, knowing the difference between what you need and what you want is going to make a big difference with whether you can live on a budget or not.
Before you buy anything, ask yourself if it’s a necessity. If it isn’t, then perhaps try waiting for a bit before purchasing it. If nothing else comes up that you need for the week, then you can go back in a couple of days and buy it guilt-free.
3. Only Spend Cash
If you have a strict budget every week that you need to stay within, we recommend withdrawing it from your bank account and spending it on the things you need in cash.
This way, you’ll be able to see exactly how much you’re working with. As you spend it, you’ll be able to keep track of what you’re using and how much you’ve got left. This can help you live within your means and accommodate those needs over your wants.
4. Cut Down Your Expenses
When you made that list of all income and all expenses, there’s a good chance that there were some things you wrote down that you could do with getting rid of.
Cancel any service or subscription that you don’t use every week. For those subscriptions and services that you do use, you could always try calling the company to see if they can give you a better deal, too.
Final Thoughts
Things are looking a little bit different now that you’ve got your tax refund.
While it’s not the amount you were hoping for, this doesn’t mean that you have to spend more time worrying about how you’re going to pay your bills. Instead, it’s an excellent opportunity to learn how to live on a budget without having to sacrifice too much.
With these simple tricks and tips, you can learn how to spend your money smarter and save it where you can.
