Budgeting to help pay off your homeloan

Budgeting to help pay off your homeloan

budget managementWhy is budgeting important? Because if you plan your budget well you could be bond free in just a couple of years. Your bond is a big noose around your neck and although the interest rate is less than your credit cards or vehicle interest, the length of time it takes to pay it off is crippling you with Interest. If you use the bond calculators to see the difference it makes to add an extra 10% or more to your payment, you will be astounded at how much interest it save.

Here are 6 reasons to keep your financial goals in check:

  1. No more debt: List your income and expenses.  Budget for each item; fixed expenses such as car payments stay the same each month. Put a set amount of money aside for variable expenses such as food and clothing.  Budgeting eliminates the need to overspend; it gives you control of the money you earn (income) versus the money you spend (expenses). To eliminate debt you need to derive a budget plan and monitor your spending. Eliminate the use of credit cards to purchase items you cannot afford. Stick to the budget at all times to stay out of debt.
  2. Make your dreams a reality: Another reason to budget is to finance for your long term goals; should you want to save for a holiday or to purchase a home. A sure way of attaining your long term and short term goals is to stick to your budget.
  3. Retirement: If you want to spend the best years of your life traveling the world then start a budget plan today.  Build and renovate your home when you retire to live the life of your dreams. Whatever you choose to do; you can do so with a realistic budget plan.
  4. Be smart and save money: Overspending is common throughout the world; people live above their means. Allocate ten percent of your gross income towards savings; you might need the money for an emergency.
  5. Prioritize: Wants versus needs; keep your financial goals in mind. Focus on spending money on necessary items such as rent, car payments and savings before you overspend on entertainment.
  6. Eliminate financial stress: Budgeting is a secure and safe way to keep track of your expenses and save money. Using money wisely will give you the confidence you need to make your dreams a reality.

Budgeting is a good way to attain your financial goals in a responsible way.  Many people use credit cards for impulse purchases; this is one of the reasons people are in debt. People spend more than they earn which puts financial stress and pressure on families.

Allow the money you earn to work for you by deriving a realistic financial budget. You can teach your children to do the same. It is possible to save for your future aspirations; discipline and focus are necessary to achieve your dreams with a realistic budget plan.