How to Recover from a Blown Budget

Went a little crazy on holiday shopping and now your budget is completely off track? Get back on the path to financial freedom and kick off the new year with the following tips:

  1. Stop dwelling. Going over your budget isn’t fun, but it’s not the end of the world. Life happens and you can’t be perfect all the time. Acknowledge that you messed up, then move on. Obsessing about it isn’t going to bring your money back.
  2. Get back into your old routine. Play a little bit of catch up: pay your bills, balance your checkbook, and schedule transfers to pay off some debt if possible. Sometimes when you fall off track, it makes you want to stay off track. It takes more effort to jump back on the bandwagon than it does to remain on the same path. That’s why it’s important to get back into your old routine as soon as you have the chance. Get everything caught up, map out a plan for the remainder of the month, and immediately return to your former routine.
  3. Temporarily cut expenses. If you need to cut back, consider the following tactics:
  • Eat at home until you’ve cleaned your shelves/refrigerator/freezer out.
  • Have “no-spend” days, when you don’t spend a single penny.
  • Skip paid entertainment and opt for board game nights or movies at home.

If you’re still facing a budget discrepancy, you may have to look for extra ways to earn money for the month. Consider selling clothes, furniture, and appliances that are in good condition but that you no longer use. Or can you pick up extra hours at work, or get a part-time job?

If you’ve blown your budget, the important thing is to pick up where you left off and get back to your budget as soon as possible.

Need help creating an organized household budget? Check out our budgeting guide and budgeting fillable PDF worksheet.

Article Source: Alexa Mason for Moneyning.com

Break the Bank this Holiday Season? Get Back on Track!

Even if you didn’t storm the shelves at 3am on Black Friday, there’s a good chance you may have overspent during the holiday season. If you’re fretting about your finances, there are a few things you can do to remedy your wallet. Follow these tips for reversing the damage and getting back on financial track.

Make some returns.

It may be tough to do but it’s time you take a hard look at the purchases you made. Did you buy gifts for others or splurge on yourself? If you intentionally made purchases for your loved ones you will probably be safe holding on to those items, as chances are you were budgeting for them. But, if you spontaneously spent on things you may not need just because they were on sale, consider returning those extras to put more money back in the bank.

Save what you bought for the future.

Just because you bought your child ten toys doesn’t mean they all have to end up under the tree this Christmas. If you decide to keep them all, hold on to a few for future holidays. That way when it is time to celebrate Timmy’s birthday, you’ll have already spent money on his gifts and won’t be out even more cash down the road.

Cut costs elsewhere.

If you overspent and are feeling stressed, you may have to make some sacrifices until you can get your money back to where it was. That means it’s time to scale back on the extras. Simplify your life and remember what’s of real value during this special season. Instead of eating meals at restaurants, save money and spend quality time together by cooking at home as a family. Forget spending a ton at the movie theater and opt instead to enjoy movies from the comfort of your couch.

Article Source: Wendy Moody for CUInsight.com

4 Tips for Bouncing Back from Holiday Shopping

metal spring for a car on a white background

You say you won’t go overboard every year – but once again holiday shopping may have gotten the best of you already. In spite of your best intentions, you overspent, you’re probably full of regret, and you’re getting a headache just thinking about your January credit card statement. Now what?

1. With a sober mind, go through what you bought and return/exchange if it’s not too late.

It’s easy to get so caught up in the moment — the rush of shopping, the allure of good deals and sneaky sales tactics — and you probably made a few impulsive decisions, even if you didn’t overspend.

Shoving the items you felt guilty or embarrassed about to the back of the closet might make you feel better, but the act might also cost you the 30-day return/exchange window — in other words, an opportunity to reverse your losses. If you didn’t give some items as gifts, return them stat.

2. Offset over-budget spending by cutting elsewhere.

If you’re in the red after the holidays, it’s time to offset your spending by cutting a different area of your future budget to accommodate it. Start by totaling what you spent and comparing the total to discretionary spending you’ve budgeted for January 2017. Is there something that matches the exact dollar amount? What about two or three ‘luxuries’ that match one half or one third of what your spent? Cut them. You may only need to cut a service or two for a month before you’re back on track, so it’s really not much of a sacrifice. Consider cutting the following:

  • Extra cable channels
  • Netflix and other streaming media accounts
  • Scheduled hair treatments, massages, or manicures
  • Magazine, book club and other subscriptions

Beware: cutting one of these temporarily might show you how little you’ve missed it… and how much nicer it is to have the cash!

3. Pay it back — fast.

If you charged up your credit card(s), the debt you accumulated and the interest attached to it may have even longer side effects than a light bank account. Resolve to pay your shopping debt off entirely within one to three months. If that’s not feasible, try to pay at least three times the minimum amount. Ultimately, aim to keep your balance below 40% of your credit limit so you won’t hurt your credit report.

4. Redeem those freebies.

Many retailers offer cash back in the form of gift cards on special buys through the holiday season or early into the new year, but reports show that many are never used. Don’t let your freebies go to waste – use them to retroactively pay for over-budget spending. If the gift cards aren’t for stores you shop at, go online and sell or exchange them for something you’ll be able to use. Just don’t let them go to waste.

Article Source: Jessica Sommerfield for Moneyning.com