There’s always an excuse for not saving money or paying off debt. But saving money and paying off debt doesn’t have to be extremely difficult or arduous. There are two very easy and simple ways to save money and pay off debt.
Goals and budgeting go hand in hand. You can’t spend more money than you have and yet, you don’t want to become a miser either. The easy way to save money and pay off debt is to create goals that you can attain. It’s about working smarter, not harder. You need to be smart to create goals that will help you save money and pay off debt.
What is a smart goal?
S.M.A.R.T. goals are Specific, Measurable, Attainable, Realistic and Time-Sensitive. These are the five key ingredients to any goal, and the solution to creating goals for an efficient budget.
What does a smart goal for an efficient budget look like?
To improve your budget, start with a series of small, but smart goals. Say you want to reduce your spending, pay off your debt and become debt free. Those are worthy and important goals but they are not specific.
One must first learn how to walk before they can run, so set a smaller, yet smarter, goal.
Specific: Slash spending by 10 percent.
Measurable: Write down total spending now, and total spending in a month after you’ve implemented your specific goal.
Attainable: By reducing variable expenses, such as groceries, gas, dining out and entertainment, you can definitely attain a 10 percent reduction in spending.
Realistic: This is a realistic goal because it is achievable over a period of time.
Time-Sensitive: When do you plan on completing this goal? Giving yourself a month is a good amount of time to see if you reached your goal.
Smart goals can be used in every facet of your life, from dieting to budgeting to job-related and family-oriented. To increase the chances of having an efficient budget, it is important to be consistent with your smart goals and to continue to create new goals.
Once spending has been reduced, another goal could be to increase income. This can be done by taking a side job, creating a side business, or doing overtime at your current job. To make this goal even smarter, be more specific.
Specific: Increase income by 10 percent
Measureable: Compare last month’s income to this month’s income
Attainable: Take a side job, perform freelance work, sell stuff, do overtime work, start an Etsy shop
Realistic: It is realistic to increase your income by 10 percent
Time-Sensitive: Give yourself a few months to reach this goal
Within a few months of these smart goals, you’ve been able to reduce your spending by 10 percent and increase your income by 10 percent, providing you with an extra cash flow of 20 percent that can go toward paying off debt and saving money.
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