How to Start Saving Money Using Your Budget

A budget is a great tool to help you track your your expenses so you have a better control over your finances. I have been using the following budget for my family for the last 17 years that gave us the freedom to live without paying any debt or interest while saving for the future.

The $200 Budget Habit That Saved Us From Being in Debt and Paying Interest

The goal for a budget is to spend less than you make so you can start saving for the future and emergencies. My initial saving plan was to save $1,000 for an emergency fund when we lived on $200 budget. You want to come up with a realistic number to keep you motivated about saving.

So how do you make your budget work for you? I use a notebook to create my budget (see above link) every year. Once that’s is done, I take a piece of paper and start adding my monthly expenses under every category I had added. I stick it to my fridge for easy access. Categories are different for every family. For example-

Rent- $1250

Grocery- $350

Clothes- $15.95

Gas- $125

You add all your expenses at the end of the month. You want this number to be less than your income.

Now you know how much you make and how much you spend each month. This is the time when you want to come up with how much you want to save every month.

When you know how much you want to save every month you can cut back expenses on certain categories or remove an entire category. For example you can reduce certain expenses on the Grocery category and remove the Category Netflix from your monthly budget.

I hope you are able to save with the budget that you had created insha Allah. Please keep in mind that no amount is too small. If you can save $5/month, you will have $60 at the end of the year. A small step towards your budget can make a big difference later.

 

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