Personal Finance Budget Tips for Beginners

February 18, 2021 | Louis Tully

If you’re tired from living paycheck to paycheck, setting up a personal finance budget is your best way to take control of your finances.

Setting up a personal finance budget might seem intimidating at first, but there are a few tips you can use to make the process simpler. And for emergency needs, we show you how to get a title loan.

Consider Indispensable Income When Setting Up a Budget

personal finance budget

1. Wants vs. Needs

When setting up your personal finance budget, review your primary expenses according to your bank statements and divide them into two categories – needs and wants.

Needs are the expenses you cannot avoid: rent, utilities, gas – but also groceries, and even savings. These are the categories you should budget for first.

You can do the rest of your personal finance budget for everything else with what’s left.

2. Budget in the “Fun Money”

Budget isn’t a deprivation device – you should still be able to have fun. You should just stop overspending. Take the amount of money you think you could spend monthly without sacrificing your financial goals – and put it in the “fun expenses” category.

This can be anything from takeout to new clothes. Everything you don’t strictly need – but will make you happier from time to time.

Just not at the expense of your needs.

3. Find What You Can Cut

This is where you figure out what you’re overspending on – and stop. Things like takeout (it should be an occasional treat, not an everyday occurrence), cigarettes, subscription services, cable, even groceries are all things you are likely to spend more money on than strictly necessary.

Figuring out what you can live without and what you can cut down on can take some time, but start small (cut things you haven’t used in a long time, switch to free apps, cut down grocery budget little by little) and go from there.

4. Automate Your Savings

Saving is easier if it’s the first thing you do with your paycheck. Automate your savings – even if it’s just 5% monthly, in the beginning, the amount matters less than creating a habit out of it. When creating your personal finance budget, you should view your paycheck as less than it is, with a portion of it untouchable when it comes to spending.

Ideally, you should be saving 20% or more of your paycheck – but you can start smaller, as long as you start.

Use your first budget to figure out how much of your money is going to go towards the “needs” category (rent, utilities, groceries), then decide on the savings percentage.

And only then start using your personal finance budget for wants.

car title loans

5. Make Sinking Funds for Larger Purchases

If you wish to purchase something that costs a lot of money (tech, vacations, etc.), then start saving for that goal specifically.

Namely, set up a separate savings account (or a cash envelope) for it, figure out a timeline (how much it costs vs. how much money you can spare for it from your monthly personal finance budget), and adjust your budget accordingly, if you wish to make the purchase faster.

This will help you avoid unnecessary debt and control purchasing impulses, making it easier to spend money intentionally.

6. Prioritize the Emergency Fund

No matter what it was that galvanized you to start budgeting, saving money for emergencies should be your first concern when you do. If you wish to stop living paycheck to paycheck, you need to minimize the importance of each paycheck – and that can only happen when you have enough money saved up to not worry about losing it.

An emergency fund that covers 3 to 6 months’ worth of expenses will help you not only cover any financial problems that pop up unexpectedly but will enable you to handle even the worst financial emergency imaginable – the job loss.

On the other hand, if you don’t have an emergency fund, any unexpected problem could bust your budget no matter how hard you try.

Try Taking Out a Car Title Loan if You’re Pressed for Cash

If your emergency fund is yet to be funded, an auto title loan is an optimal solution to get title loan cash fast. The entire process takes on average 30 to 45 minutes and you get the cash the same day, which enables you to handle the emergency quickly and stop it from exacerbating and costing more down the line.

The application process is simple and straightforward – anyone who’s at least 18 years old and whose car title is in their name can qualify. The lender will accommodate any kind of income stream, and poor credit or no credit, for that matter, will not influence loan approval.

How Do I Apply for an Auto Title Loan?

You can easily apply for title loans online by going to the NewMexicoTitleLoansInc.com website and filling out the online form. You’ll be contacted by the store representative who’ll set up a meeting with you.

You’ll need to bring your car, the car’s title (must be in your name and completely lien-free), and your government-issued ID to the meeting. The loan representative will assess everything and determine if you qualify for the loan.

If you’re approved – you’ll get the cash the same day.

Budgeting is something that many people have difficulty doing. So, if you are a beginner in learning how to set up your personal finance budget, use these easy steps to get you there. Once you begin, it will be hard to imagine how you haven’t been doing it all along. If you need a little assistance because you have experienced a financial emergency, New Mexico Title Loans can help you get the emergency title loan cash you need to get back on track.