It’s a simple concept. But it can be hard to put into practice.
After all, budgeting isn’t exactly exciting, is it?
Maybe not at first. But when you see the results, the excitement starts to build. Along with the rewards.
Each year, Regions Bank associates volunteer thousands of hours sharing financial education with groups across Metro Jackson and beyond. Building financial wellness is one of our top community priorities because we believe it leads to better lives and a stronger foundation for long-term success.
Consider a topic often shared by our financial wellness teams—the value of creating a monthly budget. If you want to stop living paycheck to paycheck, here’s the simple concept:
Change your mindset. Rather than thinking of a budget as a drastic monetary diet, see your spending plan as a way to buy your financial freedom over time.
Compare income to expenses. First, add your take-home pay (after deductions and taxes) without including bonuses or tax refunds. Next, track all expenses, no matter how small, including money set aside for charitable giving. Keep this up for at least a month so you can get a reliable view of your fixed and variable expenses. Place each of your expenses into one of three columns: Fixed (necessary, month-to-month bills like mortgage or rent), Flexible (varying monthly bills like utilities) and Discretionary (dining out, entertainment).
Use tools and technology. Plenty of high-tech and low-tech tools can also help you learn how to budget. For instance, Regions’ budget calculators on Regions.com can help you categorize and track spending. Additional tools are available for free on our website, regardless of whether you’re a customer.
Decide what you really want. Once you have a budget, set short-term or long-term priorities for discretionary expenditures that you’d like to make as long as the budget allows. This includes things like vacation expenses or concert tickets. By prioritizing which of these you want the most, you can avoid impulse spending. If there are just too many options, try to think strategically. List the pros and cons, or ask friends and family to weigh in. Remember, if you cut out all the fun, your budget will be as hard to follow as a strict diet. So leave yourself some financial flexibility where you can.
Pinch pennies. If your expenses exceed your income, look for opportunities to start paring back, such as making your own coffee and packing a lunch, buying generic products over brand names, dropping premium cable channels, or going out to eat less frequently.
Switch your budget to autopilot. Set up direct deposit for your paychecks, with percentages funneled to savings and bill payment accounts to keep funds off-limits to impulse buying. Automatic billing can also help you avoid late payment fees.
While creating a monthly budget is just one part of overall financial wellness, it is a good first start. Regions also offers updated financial education content through the Next Step Financial Learning Center on regions.com. One of Next Step’s newest features, called “Raising a Financially Fit Family,” provides insights on building financial success throughout life’s major milestones. Topics include teaching children and teens about money management, balancing the family budget, saving for college, and more. Next Step articles, budgeting calculators, and checklists are available for free to anyone without needing to have a Regions account or online banking login.
These and other resources can help develop the essential skills of setting a budget, building savings, planning for retirement and more. At Regions, we are with you every step of the way on your journey to financial wellness. Our associates are available to offer advice, guidance and education at any of our branches convenient to you.
Sure, if you’re just getting started, it may not be exciting. But wait until you see the rewards.