Are you struggling to get your finances in order? Do you feel like something is going on and tripping you up every time you go over your budget? Unexpected bills can quickly blow your budget if you’re not prepared for it.
If you’re looking for a way to take control of your finances and keep your budget on schedule, now is the time to create a budget binder. Learn what a budget folder is, how to create one, and tips on how to stay on track.
What is a budgeter?
A budget folder is a great way to keep all your financial information in one place. The binder includes your income, debt, medical expenses, and anything else that affects your financial situation.
Having a budget binder can make life easier because you won’t have to worry about losing receipts or forgetting to pay bills. It’s also a great way to get organized, keep track of your finances, and plan for the future without cost of hiring a financial planner.
If you have a family, a budget planner can help you keep track of your family’s expenses and income to ensure everyone’s needs are met and increase your family’s financial stability. The best part about the budget binder is that you can customize it depending on your financial goals.
How to use the budget binder
By organizing your financial life in a budget folder, you can decide how best to use your resources and make sure you live within your means. Here are some tips to help you get started with your budget binder:
Set goals
Setting goals is the first and most important step in creating a budget binder. Whether you want to save on your down payment on your home or pay off your debts, setting specific goals will help you stay on track.
The best way to master goal management is to break down long-term goals into short-term ones. For example, if your goal is to pay off a $10,000 debt, you can pay it off in 2 years by paying $417 monthly to pay off the debt. If you’re feeling overwhelmed and don’t know where to start, consider ask a financial advisor for helping me set goals using the budget folder as a reference.
You want your goals to be achievable and always in the spotlight so you don’t forget them. Breaking down your goals into smaller, more manageable steps and tracking your progress in your budget folder is a great way to make your financial dreams come true.
Recording income and expenses
Once you set your goals, you can track your earnings with the help of the budget binder. Be sure to list all sources of income such as salary, part-time work, and investments.
Make a list of your fixed expenses, such as rent or mortgage, car payments, insurance, and subscriptions. Then track your variable expenses like groceries, gas, and entertainment.
Pay bills on time
Who doesn’t hate late payments? Paying your bills on time is critical to keeping your financial situation in good shape. The budget folder is ideal for keeping a bill payment calendar, storing paper invoices, and documenting your payments.
If you prefer to use binding with technology, sign up for automatic bill payment. Automatic bill payment is convenient and can help you avoid costly late fees that can hit your budget hard. You then need to keep an eye on the monthly calendar in your budget folder to make sure your automatic payments go through.
Debt repayment tracking
Anyone who has dealt with debt knows that it can be a real burden to keep you from reaching your financial goals. Every day you face pending payments, high interest rates and a seemingly endless cycle of debt.
To prepare for debt repayment, first list the type of debt, balance, and interest rate for each of your loans. You can also create a tracker to track your progress towards your debt repayment milestones, so you can track your milestones and keep yourself motivated to get out of debt.
Budget Planner
Budgeting is one of the most important steps you can take to get out of debt and take control of your finances. Now that you’ve set financial goals and taken a look at how much money you get in and out, you can plan your budget.
Take a look at your discretionary spending and see where you could cut spending and increase your savings or debt payments. Add monthly debt payments and fixed expenses to your budget to ensure you always reach your goals.
Money Envelope Shop
A money envelope system is a method of organizing where you set aside a certain amount of cash for certain discretionary purchases, such as food or restaurantsand then store the bills in labeled envelopes.
Using cash envelopes is a good system for those who want to see how much money they have left to spend each month. When all the dollars in the envelope run out, you are done spending the month.
If you’re struggling with credit card overspending, cash envelopes can help you cut costs. You can store cash envelopes in your budget folder for safe keeping.
Materials you will need to assemble the folder
When planning your finances, you need something visual and tangible to keep you on track. All you need to build a budget folder is a little imagination and some basic materials.
Here is a list of supplies you will need to create your budget folder:
- ring folder
- Tab separators
- Pockets/Folders
- paperclips
- Stickers (optional)
- Highlighters (optional)
- Label maker (optional)
Required pages for budget binding
Now that you have all the materials you need, you can start adding content to your folder. Here are a few must-have pages for your budget folder:
cover binder
The cover is at the front of your budget folder, which will help you stay motivated as you flip through your pages. Get creative and create a cover that reflects your style. You can use neutral colors or even photos to create a unique cover that you enjoy looking at.
Goals page
This page in the budget folder is all about setting money goals. Write down your long-term and short-term financial goals, including specific savings goals. Write down the date you hope to achieve each goal, and be sure to update this page as you reach your goals.
monthly calendar
The calendar page in your budget folder is an important tool for meeting your financial obligations. By writing down the due dates of your bills, when you get paid, as well as important financial dates such as tax day, you can plan ahead for your financial success.
Monthly Fixed Costs
Monthly fixed expenses are living expenses that remain relatively constant each month. These include mortgage payments, insurance premiums, and loan payments. You will want to document your fixed expenses, how much they cost and when they are due.
Monthly variable expenses
Monthly variable expenses are expenses that change from month to month. These include gas expenses, medical bills, health insurance, and shopping expenses. When tracking variable expenses in your budget folder, you need to record how much you spent each month and calculate an average to help you budget over several months.
Annual expenses
This page in the budget folder is for expenses that are typically paid once a year, such as insurance premiums or business and property taxes. Christmas and other holiday gifts are also annual expenses to keep in mind. Keep track of when these payments are due so you can plan ahead.
Savings tracker
If you’re working towards a specific savings goal, use this page in your budget folder to track the progress of your savings toward a specific goal, such as the down payment on a house or a new car. Record how much you save each month and watch your savings grow.
Debt Tracker
If you’re working to pay off debt, this page can help you stay on track. Do this by listing all outstanding debts and monthly payments and interest rates. Don’t forget to update your debt tracker to see your progress as you reach milestones.
Emergency fund tracker
An emergency fund is an important part of any financial management plan. This page can help you keep track of your progress as you put off those unexpected payments that always come up. List your savings goal, the date you hope to reach it, and how much you’ve been saving each month.
Salary tracker
When you get paid at your regular job, use this page to track your salary and budget for each pay period. This can help you make sure you have enough money to cover your expenses while still having money left over for your savings.
Tracker of funds for redemption
An amortization fund is a savings account that you use to set aside money each month for future expenses. Regular contributions to your sinking fund can help you meet your financial goals and avoid debt to pay significant expenses. Use this page to track your sinking fund balances and make sure you’re on track to meet your future expenses.
Free Printables for Budget Binding
Having a budget spreadsheet is already a solid start for managing your finances. And why spend money on ready-made binding when you can easily make it at home? You can get creative and customize the binding to suit your style.
There are tons of great budget blogs with free printables for budget binding if you search online.
Earn money saving money today!
Now you know how to create your own budget folder to save money. There are many ways to organize your budget folder to suit your needs, so feel free to get creative and make it work for you!
Keep in mind that no matter how creative and well thought out your budget folder is, the only way it will be effective is if you use it regularly. Remember to set aside time each week to update your folder and track progress towards your financial goals.
This post originally appeared on Hello Reasonable.