How to budget & Save Money-The Minimalist Approach

The road towards financial freedom is not easy, and to keep going on that road requires you to have proper budgeting so that you don’t go off track. Budgeting beforehand allows you to know whether you have enough money that you want to spend on certain things. If you are planning on budgeting, that means you have a goal that needs money, and you need proper strategies to achieve it. To live a simple life and learn the value of living with less, below are a few tips you must keep in mind.

Be true to self

You need to make good decisions with the money you will make. Establish a written monthly budget. Identify all your monthly expenses and divide them into three categories: Need, Want & Junk. Takedown every expense you made and divide them into these categories to get the idea of where your junk spending lies. Use apps that help you keep tabs on everyday expenses. Track everything to know where the majority of your money is going.

Buy few things, but of good quality.

There’s a great incentive to owning fewer things, which means you need to take care of fewer things. Hence spend on good quality items with a longer lifespan & which require low maintenance. Being a minimalist will be an advantage, as they believe in owning few valuable things.

Go debt free

You can’t be free unless you are free of that debt/loan you took. Build a monthly strategy to repay your loan, even if you can return less. Minimalism can be your crucial component. If particular possessions don’t add value, then get rid of them. Shift to a smaller house so that you can save money. Instead of buying a car, take public transport not to take up any more EMI.

Go by the 50-30-20 budget rule.

In the book, All Your Worth: The Ultimate Lifetime Money Plan, the author explained how one could get their money on balance by dividing it into The Must-Haves, The Want & savings. You should spend up to 50% of your after-tax income on your needs, like bills, rent, etc. The remaining half should be divided so that you invest 20% and spend the remaining 30% on your wants. This helps a lot in budgeting!

When you are thinking about budgeting & saving, keep all the above things in mind, and you can create an efficient tracking strategy.