Tips for Setting New Personal Budget Goals in 2011

Are you determined to save more money in the upcoming year? Setting some new personal budget goals in 2011 can help you improve your financial situation and even prevent you from going into debt. Personal budget planning isn’t always easy, and you do need to make an effort to track expenses and monitor your spending so that you are meeting your weekly and monthly goals. Creating a realistic budget will help  you get a better handle on your finances no matter what state the economy is in. Here are some important things you need to know when setting some new personal budget goals in 2011:

1. Categorize your expenses. In addition to creating separate columns for fixed and variable expenses, you need to create different categories so that you can break down expenses by type. Some of the most common categories would include housing expenses, home repairs expenses, utilities, food costs and childcare costs. These expenses vary by individual and family, so take the time to create a thorough list of all the different types of expenses you have and categorize them accordingly.

2. Consider maintenance and depreciation costs. Computers and automobiles will depreciate over the course of the year and you may end up spending money just to maintain or repair these assets. Make sure you factor in the cost of maintenance and depreciation when setting your personal budget goals in 2011. Look back at the costs of maintenance and repairs for 2010 so that you have an accurate estimate.

3. Be honest about your debts. Make a separate spreadsheet that lists all of your credit card accounts, loan balances and other types of debt payments so that you can see exactly what type of debt load you’re carrying into 2011. Be as honest and accurate as possible about your credit card balances, student loans and other loans and make a commitment to make more than the minimum payments whenever possible. This strategy will help you pay down that debt much faster and give you some relief come 2012.

4. Accommodate for your tax payments. Whether you’re paying taxes on each paycheck through your employer or are self-employed and responsible for making quarterly tax payments, make sure you include this information in the income section of your personal budget so that you know how much cash you have to work with each pay period. You do need to include income on your personal budget spreadsheet, and need to make sure it includes all sources of income, including rental income or any side income you are earning.

5. Be realistic about how much you can cut back. Setting unrealistic savings or spending goals can set you up for financial disaster and can also make it difficult to stick with any type of budget. Setting impossible goals or making commitments to pay off loans that you can’t afford can also be demotivating. Make sure that you are setting new personal budget goals in 2011 that you can realistically reach and keep track of your progress.