You might be saying, “Why do I need to budget?”
The truth is, saving every penny really does add up and having a budget will help you keep track of how much you’ve saved up! Your budget will also tell you when you need to slow down on your spending, or tell you how close you are to saving for your goal. All of those small purchases like: your daily coffee, going out to eat, or going to the movies, can add up quick. Establishing a helpful budgeting method can do wonders for accomplishing your savings goal.
One of the best ways to start budgeting is the “piggy bank method.”
You have 3 piggy banks: a “HAVE-TO”, a “WANT TO” and a “RAINY DAY” piggy bank. Your “have-to”s are for essentials like food, water and clothes. Your “want to”s are for fun things like going out with friends or attending an event like a concert or movie. Your “rainy day” piggy bank is for the things in life that we don’t necessarily see coming, but you’ll be glad you saved for it.
Every time you get money, try and break down how much you’re going to put into each piggy bank. Start by putting 50% away into the “HAVE TO”s piggy bank because it is for your most important purchases. Then put 25% into each of your “WANT TO”s and “rainy day” piggy banks, to make sure that the rest of the money is evenly distributed for purchases you’ll want to make in the future or if something unexpected happens.
The “piggy bank method” is just one of the many ways to budget, but you don’t actually need three piggy banks to use this method. Opening a savings account with Yolo Federal makes it easy to keep track of your budgeting and there is no limit to how many accounts you can open.
Budgeting is easy to get started and a great way to build a habit that will set you up for financial success!