Top 10 #Adulting Tips on Budgeting
Some days, adulting is easy and productive. Other days, becoming an adult is overwhelming and leaves you staring into space asking, “What just happened?”
As formulating a budget nears the top of your to-do list when you start your first job out of high school or college, we wanted to provide you with a top 10 list of budgeting tips to take with you.
1. Open a Checking Account
Long gone are the days of the beloved piggy bank. You have to find a checking account that meets your new adult needs such as being able to direct deposit your check, pay bills, transfer funds, and manage your money properly. Check out Renasant Rewards Extra – it checks all the boxes you need in a checking account and more. Click here to learn about the benefits of opening a Renasant Rewards Extra account.
2. 90% || 10%
Try to live on less than 90% of what you make and put 10% away. Sometimes this can be difficult, but it’s a respectable reference point when your first couple of paychecks come in and expenses start going out.
3. 50/20/10/10 Rule (ideal budget)
“Budgeting” (CC BY 2.0) by investmentzen
Using 50% of your paycheck on expenses, 20% for disposable income, 10% for charity, and 10% for investing and paying down debt is a common strategy people use when first starting to budget. This is the 90% you spend while the other 10% is reserved for saving.
4. Build an emergency fund
“Emergency Fund” (CC BY 2.0) by Tax Credits
To cover unexpected expenses you’re unprepared for, it’s always a good idea to have just a little money stashed aside. From leaky faucets to your engine overheating, you never know what can happen.
5. Watch out for the small expenses
We’re all guilty of it – too many coffees, expensive lunches, subscription services that aren’t used, etc. These expenses add up, and by cutting a few out, you will add dollars back to your budget.
6. Have Good Insurance
The old saying goes that an ounce of prevention is worth a pound of cure. Have the proper insurance in place whether it be rental/homeowners insurance, auto/motorcycle insurance, and for the pricier personal items like smartphones, some jewelry, and other valuables. The peace of mind is worth the payments, and Renasant Insurance is a good place to start.
7. Get Professionals In Your Corner
It’s hard to do everything yourself. Look to the pros to help you in different areas of your life. Find a doctor to keep you healthy, a good accountant for your taxes, and a great personal banker or financial professional for input on starting that business or applying for that loan.
8. Keep Learning
There are many stages in life, and being a lifelong learner will help you stay on top of your finances. From resources such as online classes, professional podcasts, and books – you can learn about anything under the “financial” sun. Utilize these sources of new knowledge and inspiration to help yourself gain new skills to handle your adult responsibilities.
9. Plan every dollar
Have a plan for where every dollar should go and give it a purpose. Planning expenses and purchases in advance will help you know how much money is left.
10. Learn The Difference Between A Want & A Necessity
This is usually one of the more difficult lessons to learn. With the ability and ease to gain credit and spend money, balancing needs and wants is a skill you can learn. It’s possible to take care of the necessities and make it to the big concert with your friends, but Amazon Prime purchases, and five course dinners might have to wait for another day.
Lastly, make sure you look back at your budget and see what areas you need to adjust depending on life’s circumstances. You may want a new home, decide to have a child, or plan to travel the world – just make sure your budget reflects the goals you’re aiming for.