Although the price of gas is finally beginning to fall, many Americans have been forced to make difficult monetary decisions over the past few months… scratch that, the past few years. Now that the world is starting to return to normalcy, larger ticket items are again becoming a reality. Whether you’re budgeting for new roofing in Pearland, Texas or for a luxury cruise through the Caribbean, budgeting is an important first step to any major expense.
Set Goals
It should be obvious, but the first step is establishing a goal, or establishing that major expense you want to make. It can be something fun or something necessary, but find an approximate price and set a realistic timeline. Some goals might already have set timelines, like credit card debt or student loans, while others, like dream vacations, might depend on the seasons. Make these considerations when setting your budgetary goals.
Set Priorities
When budgeting for any large potential purchases, keep in mind your necessary expenses. Obviously consider your day-to-day needs but also think about the bigger picture moving forward. If you know you need to replace your refrigerator or it’s time to renew your license plates, set aside the necessary amount so you don’t have any unwanted surprises. It can also be extremely helpful to have a small percentage of your paycheck automatically deposited into a savings account, especially for a rainy day or large purchase.
Emergencies
It should go without saying, an emergency fund is essential in life. You never know when an unexpected emergency might occur. Medical emergencies, unexpected vehicle expenses, vet bills, once in a lifetime weather disasters, the list is endless. The average American family could not afford a $4,000 emergency expense and it’s a scary reality to face.
Need for additional income
One often forgotten consideration is whether or not there is a need for an additional income source. Does your expense need a side hustle to make sure it can happen? If there is a need for a second job, make sure the product is worth it and the time allocated doesn’t interfere with your main source of income. Oftentimes, if it requires an additional career, it may not be the wisest decision.
Shop Around For the Best Deal
Finally, the best way to make your budget stretch its limits is by making sure you have the best deal possible. Is there a holiday weekend sale coming up? Do you have any special codes or coupons to add? Does it come highly recommended or with accompanying reviews? Going the extra mile to make sure you have a quality product is worth it.
No matter the upcoming expense, take a few minutes to make a budgetary plan. You won’t regret the decision to do the legwork first.
