Is your life the same as it was last month? What about last year? As the saying goes, the only constant in your life is change. Your budget should reflect that. If your budget has remained the same for months or years, you’re likely doing yourself no favors. If you’re having trouble figuring out when to revise your budget, look out for these signs that indicate it’s time to give it a look.
You’re Saving Less
Your budget should have a savings goal. If you haven’t been hitting that mark, that’s a red flag. It’s time to revise your budget. Check out your expenses and see where your money has been going. Once you identify the holes, plug them up by cutting back. With expenses reduced, redirect your funds to your savings so you start hitting that goal again.
You’re Charging More
Using a credit card to pay for expenses can be smart. You take advantage of your card’s rewards while also helping out your credit score. Of course, using a card is smart only if you’re able to pay off the balance each month. If you’ve been struggling to pay your credit card, it’s time to comb through your budget. Just like with savings, you’ll need to find areas where you can cut back, then use the extra money on your credit card debt. And remember: Don’t wait to address debt. The longer it goes unpaid, the more interest you’ll pay.
Your Fixed Expenses Have Increased
As USA Today notes, despite the term, fixed expenses don’t always remain the same. Rent can increase; cell phone plans and streaming services can change. If several fixed expenses have jumped in cost, take a look at your budget to make sure you can still afford them. If they’re too much to handle, take steps to reduce their costs (many times a simple phone call will snag you a discount).
Original article by Chris O'Shea and adapted in partnership with SavvyMoney.