Anna’s Budget Tips-Budgeting for the New Year

Happy 2013! There’s nothing quite like the start of a new year to give you a renewed sense of hope, purpose and motivation to accomplish just about anything. Tap into the power of this season and get your family budget in shape for the new year. A little effort now could really pay off by the time we’re saying hello to 2014.

2013 new year graphic

Identify Your Goals

I find it helpful when setting a budget to decide what I most want to accomplish financially and then focus on how to make it happen. It could be establishing an emergency fund that would cover three, six or twelve months’ worth of expenses. You might want to live off of ninety percent of your income so that the other ten percent can go into savings. Or maybe you’d like to set aside a certain dollar amount for a down payment on a house, to pay off debt, to take a vacation or for a college fund.

One Month at a Time

If you’re shooting for a certain dollar amount to save over the course of the year, divide that figure by twelve to find a monthly amount you plan to save. You might consider dividing it by eleven, which will mean you’ll have your savings taken care of by November and can allocate that amount to the extra costs that crop up during the holidays.

Find Places to Save

Once you know what you’re hoping to save each month or, looking at it another way, what you can spend each month, take a look at your expenses to see how they stack up against that number. If there’s a large discrepancy (for example, you need to live on $3000 per month but you normally spend $5000) it might be time to make some tough choices. To make up a large gap it’s worth considering downsizing to a smaller or less expensive home, trying to find a higher paying job or making drastic cuts in spending.

However, if you find you could accomplish your goals by spending a few hundred dollars less each month, you can likely accomplish this by just being more mindful about where your money is going. I find that food represents the largest opportunity for savings for my family. If we set a budget and stick to it, we can shave a few hundred dollars off of our grocery and eating out expenses…without going hungry of course. What works best for us is to set a monthly limit and when it’s gone it’s gone. That might mean a few nights of eating whatever is in the back of the pantry, but it helps us save and we tend to waste less food. It’s also great motivation to be creative with what we have and think outside the grocery store. This was how we discovered how easy and delicious homemade flour tortillas are!

Other areas where you might identify potential savings include:

  • Entertainment (cable/satellite, movie rentals and subscriptions, movie and concert tickets)
  • Shopping (clothes, household items, electronic gadgets)
  • Travel (gas, hotel stays, flights)

Search for Big Savings

While you’re trying to shave a few dollars off the grocery expenses and looking for ways to cut the cable bill, don’t overlook some of your larger expenses. Could you save by refinancing your mortgage or auto loan or consolidating credit card debt? By switching providers for your homeowners, auto and health insurance? It can take some time and effort to shop around and apply for these financial services, but making a few changes could have a large impact on your expenses.

Anna Platz writes for the popular personal finance blog, Good Cents Savings, which helps you save money, stick to a budget, and live well on less. She is also the mother of a four year old daughter who is worth every penny!

14 thoughts on “Anna’s Budget Tips-Budgeting for the New Year”

  1. One thing I’ve also told people is that if having a budget intimidates you, just track where you spend money for a couple months. It’s a great place to ease your way into it and once you see “on paper” where you are spending money it’s a great motivator to spend it more wisely! Sometimes seeing something in black and white makes all the difference. That’s how we started our budget by tracking our expenses

  2. Great tips from both you and other readers! I will be taking the debt monster down this year and plan to keep couponing for big savings. Making a food budget and sticking to it is the hardest for us, but I’m determined this year to do it!

    1. Good for you, Jen! I’ve heard from friends and budget experts both that a meal plan is also one of the best ways to stick to a food budget. Can’t wait to hear how everything goes for you! :)

  3. Very good tips! Thank you for sharing!

    Being more mindful of my money is something I want to work towards in 2013. While I would say I am cautious of not overspending/impulse buying, I know I could be BETTER.

    One thing that did really help me in the past was to save all of my reciepts in a month and at the end of the month look at what I was spending my money on – certainly was an eyeopener as well when I used to smoke and realized how much money I was wasting on that!

  4. A few other ideas:

    -Pay yourself first. Setup an automatic savings plan so that a small portion of your paycheque goes into a savings account. You’ll never notice the small drop and over time it will really add up
    -Take 24hours before making an impulse decision. Often you’ll find you don’t really need that widget once the fever of an impulse buy dies off

      1. Thanks Madame K! Seems like this is the time of year for weight loss/budgeting tips to get examined. In that vein, some other New Yearsy tips:

        -get a will drawn up
        -create a document of all the vital contact #s, contents of the home, copies of birth certificates/SIN and store it in a bank safety deposit box
        -rebalance your portfolio and/or meet with your IA (if you have one) to discuss finance goals
        -look at all your services and see what you can cut. everything else you should shop around, or talk to your provider and haggle for better rates (that includes tv, internet, cell phones, insurance..). Don’t forget banking and getting better value for your accounts
        -start getting into the habit of changing your passwords, particularly to online banking, at least yearly and make them complex.
        -go for your annual physical
        -use a site like to comparison shop electronics/computer goods
        -always use airmiles or cashback sites like ebates to get the most out of online purchases
        -learn to time your purchases. for example decorations should always be purchased right after Christmas.
        -take advantage of tax sheltering programs like RRSPs and TFSAs. study the annual tax guide for other tax credits and benefits that may be afforded to you

        These are just some of my life tips that I offer as party of my life coaching seminar. You too can do eet!

Leave a Comment

Your email address will not be published. Required fields are marked *