How to Take 3 Baby Steps Towards Budgeting
829 views · Published 11 February 2016 · 4:50 · Indexed 6 November 2026
Channel: Utah State University Extension · 2016 · Education
Learn 3 baby steps you can take towards budgeting from Amanda Christensen, Utah State University Extension, Morgan County. ............ When someone says the word budget, does it make you just want to like pull your hair out?? Eww! I know nobody wants to talk about budgeting, but we’ve all got to have a plan in place, some kind of plan in place for the day-to-day financial management, so today I have 3 baby steps for budgeting that will help you start somewhere on this road to financial management. Hi, I’m Amanda Christensen with Utah State University Extension. Thanks for stopping by. This week I have 3 baby steps for budgeting. All right, the first step that I would suggest is to automate your savings. Pick an amount of money that is, will fit within, what you can do and still feasibly get by month-to-month. That can be $5, okay? It doesn’t have to be 10%. It doesn’t have to be 5%. Truly and honestly, it could be whatever you can manage, but automate that amount, so that it goes into a separate account at your financial institution every month and you develop a savings habit. Sometimes, the key to success financially has nothing to do with the dollar amount and more to do with the successful habits that you follow and establish. By making that automatic savings payment to yourself every month, you will start to really feel like you can manage this. You can do this. This is a step down the right direction, even if it’s a small amount every month. The second baby step to budgeting is to create a personal allowance for yourself. Decide what amount of money you could feasibly spend every month after your bills are paid and your savings is paid. What can you feasibly spend as disposable income on entertainment, on eating out, on new shoes, on a trip to the movies, on whatever it is that you choose. Call this your personal allowance, set a specific amount that you will spend, take that amount out in cash every month, and have that in your wallet with you. When it’s gone, it’s gone, you won’t be tempted to spend anymore beyond what you have allocated. My third and final step on these baby steps to budgeting is to download the Power Pay App. You can download the Power Pay App in the App Store. If you don’t have a smart phone or if you’ve got an Android device, check out website at powerpay.org. Power Pay, whether you use the app or the website, is a free resource for you to enter in all of your debts and see how long it will take you to pay off those debts by choosing either highest balance first, lowest term first, or some other options that you choose. It’ll also show you the difference with or without power payments and explain what a power payment is. Essentially, and you might have also heard the term, a snowball payment, but as soon as we’re done with paying off debt 1, we take the payment that we’re used to paying down on debt 1, and we add it to the payment on debt 2 that we’re currently paying, so that snowball effect causes us to pay down our debts a lot quicker and save a lot of interest, on money that we’re paying towards interest, than we would have had we not used power payments. The reason I include using Power Pay as the third step on my baby steps to budgeting is because we all need to take stock of the debts that we owe. We need to get that out on the table, realistically see what that picture looks like for us, so that we can then take steps to knock that debt off and reward ourselves when we do. That’s it for my baby steps for budgeting. Automate your savings payment, take out a personal allowance, and spend only the personal allowance on miscellaneous fun things every month, and three: take stock of your debt using Power Pay. I feel like these tips aren’t overwhelming for someone who has done absolutely nothing with their personal finances. Thanks again for watching. I’m Amanda Christensen with Utah State University Extension. Check the description box below for ways you could reach out to me on social media and leave a comment. Let me know what baby steps you have for budgeting. Thanks for stopping by, we’ll see you soon, bye. ................ Connect with USU Extension! Facebook - http://facebook.com/usuextension Twitter - http://twitter.com/usuextension Pinterest - http://pinterest.com/usuextension LinkedIn - http://linkedin.com/company/usuextension Google+ - https://plus.google.com/+usuextension
