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Financial Fundamentals

5 Budget Reset Habits for 2024

β€” Alexandra Ardelean

The new year is just four days away! Can you believe it? I'm so excited to start fresh and get back on track with my budget. I've been playing a lot of TAPL lately, and it's one of my favorite games. It's a fun and strategic game that the whole family can enjoy. You can find TAPL at Walmart.

In the spirit of starting fresh, I want to share five budget reset habits that I'm implementing for 2024. These habits will help me get back on track with my budget and set myself up for financial success in the new year.

Review Past Year's Expenses

The first budget reset habit I'm implementing is to review my expenses from the past year. This will help me identify areas where I may have overspent and make adjustments for the new year.

I plan to scrutinize my bank statements and examine each expense to understand my spending. I will also utilize the EveryDollar app to categorize my expenses and identify areas where I may have exceeded my budget.

By reviewing my past year's expenses, I'll be able to identify any problem areas and make a plan to avoid overspending in those categories in the new year.

Remove Unnecessary Budget Categories

The second budget reset habit I'm implementing is to remove any unnecessary budget categories or adjust their amounts.

As I was reviewing my expenses from the past year, I noticed that there were some categories that I didn't really need. For example, I had a subscription to a magazine that I never read, so I canceled it. I also had a category for "entertainment" that was too vague, so I broke it down into more specific categories like "movies" and "dining out."

By removing unnecessary budget categories or adjusting their amounts, I'll be able to allocate more money to the things that are important to me and avoid wasting money on things that don't bring me value.

Plan Sinking Funds for Larger Expenses

The third budget reset habit I'm implementing is to plan sinking funds for larger upcoming expenses.

A sinking fund is a way to save money for a specific expense that you know is coming up in the future. For example, if you know you'll need a new car in a few years, you can start saving a little bit of money each month in a sinking fund so that you'll have enough money saved when it's time to buy a new car.

I have a few larger expenses coming up in 2024, like a vacation and some home repairs, so I'm going to start saving for those expenses now by setting up sinking funds in my budget.

By planning sinking funds for larger expenses, I'll be able to avoid going into debt when those expenses come up and stay on track with my financial goals.

Track Daily Transactions

The fourth budget reset habit I'm implementing is to track my daily transactions.

One of the best ways to stay on top of your budget is to build a daily habit of tracking your transactions. This will help you stay aware of how much money you have left in each category and avoid overspending.

I use the EveryDollar app to track my transactions, and it has been a game-changer for me. The premium version of the app allows me to connect my bank accounts and credit cards so that all of my transactions are automatically imported into the app. Then, all I have to do is categorize each transaction as it comes in, which only takes a few seconds each day.

By tracking my daily transactions, I'm able to stay on top of my budget and make sure that I'm not overspending in any category.

Re-evaluate Subscriptions

The fifth budget reset habit I'm implementing is to re-evaluate my subscriptions.

It's easy to accumulate subscriptions over time without realizing it. For instance, you might have signed up for a free trial of a streaming service and forgotten to cancel before the paid subscription kicked in. Or perhaps you subscribed to a magazine or gym membership that you no longer use.

I plan to go through all of my subscriptions and evaluate whether or not they are still bringing me value. If there are any subscriptions that I no longer use or need, I'll cancel them so that I can save some money each month.

By re-evaluating my subscriptions, I'll be able to free up some extra money in my budget and avoid wasting money on things that don't bring me value.

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Don't let holiday spending derail your financial goals! Start fresh in the new year with these five budget reset habits.