Personal Budget

How To Include Impulse Spending and Occasional Expenses To Your Budget Planning

We usually work out a personal budget so that we know how much we can spend without breaking our bank account. So once you've worked out a good budget, does this mean that impulse spending is a big no-no from now on? Not completely.

The thing to remember when doing a personal budget is to make it realistic to your needs - and your wants, to a certain extent. Then again, no one can foresee exactly what they will need to buy in the future. There may well be unexpected expenses.

Little Johnny might get hit in the face with a cricket ball and need some dental work. There are lots of things that might happen to cause you unexpected expenses, not necessarily in the area of health. So what can we do about these hidden expenses if we want to create a personal budget and stick to it?

For starters, if a budget is too strict with no impulse spending allowed, you probably won't stick to it, especially if you are the type of person who enjoys spending money on impulse. Where does that leave you? Worse off than before. You do need to budget for some fun things. What you need to do is set aside a certain percentage of your income to cover both impulse spending and occasional expenses.

Make sure that you have enough income to pay your expenses, though. If you find it hard to make ends meet with what you have, look for extra ways of making money, or ways to cut your expenses. You may be able to shave extra from your electric bill by turning off lights, or even switching to the type of light bulbs that save on power. Make sure your hot water system - if it is power-based - heats up only at night when the power is cheapest. Even installing draft-stoppers at each door could save you money on heating.

So when creating a personal budget, set aside a small percentage of your net income for what is important to you. If you like to eat out, budget for a couple of nights a month of eating out.

If you like to feel you can spend money on whim, decide what percentage of your income you have to spare after paying your expenses. Go ahead and spend it, enjoy yourself, but once this allowance is spent for the week or month, stop! Don't spend any more until the next pay day. In this way, you won't feel so deprived that you can't keep to your budget.

For more ideas on setting goals for your personal budget, go here   

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quote open Another ingredient in a happy marriage: Budget the luxuries first!quote close
~ Robert Heinlein

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