Struggling to stay on budget? Here are some tips

If you are struggling to stay on budget you may need to adjust your spending. We tell you how.

If you’re having a tough time staying on budget, you may need to adjust your spending habits.

Marc Rouleau, Senior Vice-President of Doyle Salewski, says those struggling to spend within their means can get back on track with a mix of discipline and basic planning.

“I can’t overestimate how important these basics are,” Rouleau told CTV Your Morning Ottawa on Monday.

“I get a lot of questions coming into the office, and people say, ‘all these things seem pretty basic’ but the discipline to actually put them in place and execute on them, that’s the key.”

First, Rouleau suggests implementing what he refers to as a “90 per cent” rule.

“The 90 per cent rule, basically, is don’t spend more than you make,” he said.

According to Rouleau, this means you should calculate 90 per cent of your monthly salary and use that as your monthly spending maximum. So, if you have a monthly salary of $5,000, you have $4,500 to spend, and $500 (or 10 per cent) to save.

“It’s not a perfect science, that’s what I always remind people too,” he said.

“It’s very grey, because you’ve got ups and downs, you’ve got unexpected expenses, but that’s OK. You can adjust for that. As long as you’re aware of it.”

Next, Rouleau suggests taking stock of your spending by placing your expenses into different buckets. This way, you can track how exactly you’re spending your money.

Rouleau suggests placing your expenses into the following categories:

• Large expenses, including housing, rent mortgage, and utilities.
• Transportation, including public transportation fees, Uber rides and car-related expenses.
• Food, including groceries, eating out and ordering in.
• Personal expenses, including hobbies, gym memberships, and life insurance.
• Everything else, whether that expenses for education, vacations, downpayments on houses and debt.

“Those buckets are really important to identify because you can’t budget without knowing where the money is going,” Rouleau said.

Once your expenses are properly categorized, you can assess where you’re overspending and how to go about reducing your expenses.

“You can’t know where you’re going, unless you go back and look where you’ve been,” Rouleau said.

“Where did I overspend, and why am I overspending?”

It’s usually not the small expenses, like a daily coffee, that cause people to go into the red, Rouleau says. Rather, it’s the larger ones that you need to examine most carefully.

“It’s maybe the clothes you’re buying, or that trip you took, or a gift for your kids, or whatever it might be, but you have to look at each separately and really identify and sit down with your partner or whoever’s doing the panning with you, and say okay, we need to make adjustments here.”

While speaking about expenses is rarely exciting, Rouleau says it can be done in as little as fifteen minutes a month, and it’s always worth taking the time in the end.

“The benefits you get, the peace of mind you get –– it’s so relieving to see people coming back to us saying, ‘thanks for the tools; thanks for giving us these basic things that now I need to put in place,’” he said.

Best of all, Rouleau says you may even find yourself with a bit of extra spending cash at the end of the month.

“The nice thing about budgeting is it goes the other way too. Sometimes you say, ‘Hey, we’ve got some extra money this month, what do we do with it?’ Have a positive outlook on it,” he said.

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