How to Stay Financially Fit this Summer
Summer is right around the corner, which means the days will be long and the sun will be shining. Unfortunately, summer can also be the season of overspending for many with sporting events and concerts, shopping for new clothes, and going out to dinner with friends. Keeping your finances intact throughout the summer is well within reach if you’re ready to plan ahead and make responsible choices. Here are some tips to prepare for a summer of financial fitness.
1. Prepare for a possible change in income
If you’re a freelancer, business owner or you get paid per diem, you can expect to see a drop in income during the summer months. Business across a wide range of industries is typically slower during the summer, so it’s best to be prepared for this reality. To avoid dipping into savings or going into debt, you can trim your discretionary spending and use the extra funds to cover non-discretionary expenses. You can also choose to find a side hustle for the summer to cover the gap in your income, such as becoming a ride share driver or getting a part time job.
2. Get your budget ready for summer
Your budget will see some changes in the summertime, and it’s a good idea to prepare in advance instead of being caught unaware. Here are some changes you can anticipate:
- Higher utility bills. With the AC blasting, your energy costs will likely be higher. Water costs will be on the rise, as well, especially if you water your lawn on a regular basis.
- Increase in fuel prices. The price of fuel has been increasing steadily for months, with no signs of slowing down. Carpooling with friends or family can help minimize fuel usage.
- Travel expenses. If you’ll be traveling this summer, it’s going to cost more than previous years. If you haven’t yet budgeted for your getaway, start saving up and/or trimming costs from other categories in your budget now.
- Social events. It’s wedding season, and they don’t come cheap, even if you’re not the one in the white gown. You may also receive invites or host other events during the summer months, such as family reunions, block parties, anniversary celebrations and more. It’s best to budget for gifts, the travel costs of attending these events and of course, for the expense of hosting, if applicable.
- Activities for kids. School’s out, and the kids will need to be kept busy. Check with your local library to see if there are any free events in your area to keep your kids active and happy.
3. Create a vacation budget
Aside from adjusting your monthly spending plan, you’ll want to build a workable budget for your summer getaway to avoid overspending. Money choices are nearly always better made in advance, so plan for every conceivable expense during your vacation. Attach a dollar amount for your hotel stay, car rental, food costs, transportation expenses, entertainment and outings, gifts, and any other cost you might have. Leave a bit of wiggle room for miscalculations, but try to keep your budget as close to the actual cost as possible. While on vacation, be careful not to go over budget and be open to a last-minute change of plans if some expenses end up being substantially higher than expected.
4. Review and adjust as necessary
Like going off a diet, blowing a budget is never an excuse to go all out and overspend without sparing a thought to the consequences. To avoid falling into this trap, resolve to review your budget and your overall spending on a regular basis throughout the summer. You can choose to do this weekly, or bi-weekly, but be sure to take a careful account of every dollar in and every dollar out. Being aware of the state of your finances in real-time instead of waking up after the damage has been done will make it easier to make responsible choices going forward.
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