Owning a home is more than just buying a house. It’s a decades-long financial commitment that requires a lot of planning, discipline and budgeting. However, the budgeting process doesn’t have to be a confusing chore-- plenty of free and low-cost resources are available that help making a budget, and sticking to it, a breeze.
Track Your Finances
The first step to budgeting is understanding your finances—especially how much money you have coming in and going out. One of the easiest, free ways to do so is by tracking your finances with a simple budget template. There are many free budget templates that can get you started. To begin, review your bank statements, check stubs and other financial documents to create an accurate financial picture of where your money comes from and where it goes. Once you start tracking your finances, it will become much easier to understand your finances, set goals and budget properly.
Get Access to Your Spending Information
One of the best ways to get your budget in check is to have a firm grasp of how much you spend, where you spend it and when the expenses are incurred. One of the best and easiest ways to do so is by using your bank’s mobile app to check your account regularly. Having access to this information will not only help you create a better budget, but will also help you gain a better understanding of where you may be able to make cuts and find savings. What’s more, looking at your spending regularly can help you catch fraud early on, before fraudsters have time to do too much damage.
Choose the Right Budgeting Style for You
Everyone’s financial picture is different, so it makes sense that different budgeting styles work for different people. The good news is, there is no shortage of resources out there to help you determine which type of budgeting will bring you the most success. While you should do your research to see what might work best for you, below are a few of the most popular and successful methods on the market:
- If you’re new to budgeting, a traditional budgeting system, where you track and compare your earnings to your spending and set goals from there is a great place to start.
- The envelope system might work great for you if you prefer to work off of a cash-based financial system that is more concrete than just account numbers and card swipes.
- The 50/20/30 budgeting system can help if you like to have specific allocations for your money but want a little wiggle room.
- If you are especially disciplined and want every dollar you have to have a specific job, the zero sum budget might be the right choice for your financial situation.
- Try out a budgeting app or software that works for you. Some of the post popular include Mint, YNAB, Clarity Money and Goodbudget.
This Financial Literacy Month, take the time to determine which budgeting resources might work best for you and take control of your financial future. The North Carolina Housing Finance Agency is dedicated to helping make home happen for North Carolinians just like you. To learn about how the Agency can help you reach goals of home ownership and beyond, visit www.HousingBuildsNC.com.