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Editor’s Note: This story originally appeared on The Penny Hoarder.
Whether you use an app, an Excel spreadsheet or a pen and notebook, your budget isn’t something you just blindly copy over month after month.
You should take a little time at the end of each month or the beginning of the next to reflect on your finances and determine whether you need to make any adjustments for the month ahead.
Your spending isn’t necessarily the same month after month, so your budget shouldn’t be either.
8 Budgeting Questions to Reflect on Each Month
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Ask yourself these questions as you close out your budget each month to create the best spending plan for the month ahead.
1. How Did My Actual Spending Compare With My Projected Spending?
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This is the most obvious question you’ll want to ask yourself as you reflect on your spending from the past several weeks.
Did your actual spending match up with the amount of money you intended to spend in each budget category? Where did you overspend? Where did you spend less than anticipated?
2. How Do I Want to Allocate Any Surplus Money From Last Month?
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If you ended up spending less than you budgeted for the month, what’s your plan for that extra money?
You have a few options. You can roll that money into the upcoming month’s budget so you’ll have more available. You could put the money into savings — whether that’s to build up your emergency fund, pad your ongoing sinking funds or add to short- or long-term savings goals.
You could invest the money in an IRA or a taxable brokerage account. You could give back by donating to a nonprofit organization. Or you might want to use the money to treat yourself to something nice.
It’s totally up to you.
3. What Was the Reason for Any Overspending?
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If you spent more money than you anticipated, don’t be hard on yourself, but take a moment to analyze what caused the overspending.
Did you turn to retail therapy to counteract a stressful week? Did an emergency arise that you couldn’t have predicted?
Did you order takeout too often? Did you forget to factor a major expense into your budget? Is your budget so restrictive to begin with that your spending limits are just unrealistic?
Reflect on why you spent more than you planned and …….
Source: https://www.moneytalksnews.com/slideshows/8-budgeting-questions-to-keep-your-spending-in-check/
