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Enjoy freedom from debt this summer

If Summer has you sweating more than just the heat, it might be wise to set a budget now, so you can enjoy the Summer fun while making sure you aren’t digging yourself into a financial situation that will take the rest of the year (or longer) to recover from.

If the thought of sticking to a budget gives you anxiety – then read on! Staying financially responsible doesn’t have to feel restrictive as long as you plan ahead.


Tip #1 – use the envelope system

An oldie but a goodie, you’ve probably seen the envelope system in action before. This simple concept relies on the use of cash, so when your money is gone…it’s really gone.

With the envelope system, you determine your spending categories, and then allocate an amount of your monthly budget to each one by putting that amount of cash into a labeled envelope. To keep things flexible (and bearable!) you can build in a budget for fun expenses such as dinner out, and you should also build in an allocation for savings and emergency funds if at all possible.

The benefit of the envelope system over other budgeting methods is that since it relies on the use of cold hard cash, any efforts to overspend would require additional effort. This will hopefully give you enough time to pause and reassess if what you’re looking to buy is worth busting your budget.


Tip #2 – plan ahead

 As mentioned before, the best path to budgeting success always includes planning ahead. Whether your budget includes the envelope system mentioned above, or something more modern such as an app, you need to take time well in advance to map out your month’s expenses. If you know a friend is getting married, celebrating a birthday, or throws an awesome annual 4th of July party, it’s best to acknowledge that added expense way ahead of time, and build it into your budget.

When planning for fun expenses, first take into account expenses that must be addressed each month, such as your bills, rent or mortgage, and savings. Next, decide what has a little more wiggle room. Take your grocery bill for instance, if you plan out your meals ahead of time and only buy exactly what you need, can you shave a few dollars off your bill?

Once your non-negotiable and flexible categories have been sorted out, determine the amount of money you feel most comfortable setting aside for your monthly splurge and then (and this is an important one) don’t spend more than your budgeted amount.

With a little planning ahead, you can have your (birthday) cake, and eat it too!


Tip #3 – Sleep on it

Impulse purchases are budget killers, yet they happen to the best of us. You see a new dress, gadget, or pool toy you just have to have, and without thinking you whip out that credit card and make it yours. Sound familiar?

While we can budget all day long, impossible to pass up deals can sneak up on the best of us. If you find yourself contemplating breaking your budget on a non-necessity the best advice you can keep in mind is…sleep on it.

Take a few days to think about how this purchase will affect your budget, and if the item you’re wanting to purchase is worth derailing you from your financial goals (and the added stress that can come along with buyers’ remorse).

If after a few days you’ve stopped thinking about the item, that’s a pretty good indicator that you don’t truly need it.


Tip #4 – Never Spend More than You Have

Does this seem like a no-brainer? At this point, it should. Regularly spending more than you have is just a bad idea. The more you do it, the harder it can be to recover your finances, the more pointless budgeting will seem, and the worse your financial situation will get.

If you’re relying on credit cards to live beyond your means, ask yourself if what you’re buying is worth years of minimum payments and added interest fees. It only takes a few purchases to dig yourself into a financial hole that can very quickly feel impossible to get out of. Do yourself a favor and just avoid spending more than you have all together.


How CreditAssociates can Help

We hope these four tips will help you plan to have a fun, but financially responsible Summer. However, if you feel your finances are beyond the help of a few quick budgeting tips, CreditAssociates can help.

We specialize in helping people resolve their debt. If you are stuck in a cycle of minimum payments that never seem to move the needle on your credit card balances, then it’s time to turn to the experts.

Give us a call today and one of our certified Debt Consultants will walk you through how our program works, and what a personalized debt-relief plan would look like for you. Consultations are free, with no obligation to enroll- request a call today.