5 Budgeting Tips to Help You Win the Year

By January 6, 2021 March 23rd, 2021 Advisor, Blog, Consumer, News
5 Budgeting Tips to Help You Win the Year


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New Year, New Habits: 5 Budgeting Tips to Help You Win the Year

The new year has begun, and many of us are breathing a sigh of relief that 2020 is behind us! After spending money on gifts and delicious treats over the holidays, it’s now time to consider other important things to ensure you have your best year yet – like your finances.

Don’t fret! Budgeting doesn’t have to be scary. In fact, there are many reasons why prioritizing personal finance can have serious benefits for you.

Benefits of Budgeting and How to Make it Stick

  • Feel in control of your life
  • Have better health outcomes (less financial stress)
  • Pay and save for things you want (vacations, saving up for a house, and more)

Here are 5 budgeting tips to help set you up for financial success this year:

1. Set Realistic Financial Goals

The best way to budget successfully for the New Year is to clearly outline your financial goals.

To achieve your finance objectives and budget, try creating SMART goals (specific, measurable, attainable, relevant, time-bound). Click here for a guide to SMART goals.

Ensure you set goals for your finances that make sense for your unique situation. It can be easy to look at your friends on social media and compare your financial situations. They may be jetting off on lavish vacations or making other expensive purchases that seem out of reach for you.

But it’s always important to stick to a budget and lifestyle that makes sense for your own situation. Overextending yourself financially to show off a certain lifestyle online is going to hurt you in the long run. Be smart. There’s nothing wrong with saving and treating yourself when you can do so guilt-free!

2. Negotiate Recurring Bills

A proactive approach to saving money regularly is to leverage your negotiation skills to lower your recurring bills. Everybody has essential services that they pay for to enjoy the benefits of having that service.

Did you know it costs companies a lot of money to acquire new customers versus retaining the ones they already have? In fact, it can cost companies up to 5x more! As a customer, leverage this opportunity to re-negotiate your monthly bills; you’d be surprised to discover just how much some companies are willing to bend to retain your business.

For example, if you’ve been a long-term customer with the same service provider, you can get in touch with them anytime to see if you can get a better deal on your weekly/monthly plan. They will likely agree to some kind of discount or offer you another incentive to keep you away from a competitor.

Here are a couple of services to consider negotiating your recurring bills for:

Home and Auto Insurance – Shop around or use an insurance broker to get better rates, especially if the term of your policy is coming to an end.

Cable, Internet and Cell Phone – If you are paying for a package that you aren’t using fully, consider speaking to your service provider to get a better deal.

Gym Membership – Ask your gym if you can get a discount on your membership – especially if you don’t use all the fitness services they offer, like towel service or fitness classes.

3. Commit to No Spend Days

If you’re looking for ways to save, start by looking at what you’re already spending money on. Try introducing a regular day each week when you commit to spending nothing. Pack your lunch, brew your coffee at home, and try to save any impulsive online purchases for another day (cutting out impulsive purchases can save a great deal of money in the long term). Audit your non-essential expenses and determine where you can cut down on spending.

Just make sure you don’t deprive yourself. Budgeting is meant to make you feel empowered (not sad). Reward yourself with fun activities, and splurge within reason when it makes sense.

Here are a few ideas on how you can commit to no spend days:

Tackle home maintenance yourself. Small home improvement tasks can become DIY projects instead of hiring service providers. YouTube has many resources to help you tackle a project on your own. However, we always recommend leaving complicated home maintenance issues to the professionals.

Consider cancelling subscriptions you barely use. Is your gym membership collecting dust? Are you not using streaming services as much as you thought? Consider cancelling any of the subscriptions you aren’t using in order to save every month.

Consider free activities. There are always fun activities to enjoy that are completely free. Whether it’s having a picnic at your local park, going on a hike, or skating on your favourite neighborhood rink – there are plenty of social activities you can do that won’t break the bank.

4. Set and Track Your Monthly Budget

A monthly budget can seem like a no-brainer, but nowadays you can leverage technology to make budget tracking convenient. Say goodbye to boring spreadsheets and hello to user friendly, secure budgeting apps!

Many of these apps will connect to your bank account and break down your spending habits into various categories. This makes it easy to see exactly where you spend your money. Having such insight can help you make better financial decisions every day.

As you make progress, you can see it clearly right in your app. This can provide positive reinforcement to stick to your budgeting goals.

Here are a few popular budgeting apps to try:

5. Set Up an Emergency Savings Fund

For many people, COVID-19 has brought a lot of uncertainty to their lives, including their finances. As the economy fluctuates in alignment with each virus outbreak, job security has become an issue in certain industries.

One way to protect yourself financially during this time is to create an emergency savings fund. If you or your partner lose your job or fall ill, this emergency fund can help you get through a challenging time.

Set aside a small percentage of your paycheque every month and make sure you don’t touch it unless it’s an emergency. One of the best ways to ensure you set this money aside is to automate transferring this amount into a savings account. If an unexpected situation arises, your emergency fund can provide a financial cushion.

Like an emergency fund, a life insurance plan should also be a key consideration in your long-term financial plan. By investing monthly into your life insurance plan, you are ensuring that, in the untimely event of your passing, your loved ones are financially protected.

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