In today’s day and age, more people than ever before are working from home. While there are both pros and cons, one thing remains the same for everyone: making the change from a traditional office to a home office is easier said than done.
One of the first things you’ll notice is that working from home has the potential to turn your finances upside down. For example, you’ll realize that you’re eating at home more often, which could save you money in your monthly budget. That’s a good thing.
Conversely, you may find that you’re using more electricity, which means you’re paying more for this utility every month. And that’s something you need to account for in the days, weeks, and months to come.
Here are five budgeting tips for the first time work at home mom to follow:
1. Review your budget
This is where it all starts. You need to review your budget before you do anything. That’s the only way to have an idea of what comes next. If you neglect to do this, you won’t have the foundation you need to make informed and confident decisions.
2. Make note of potential problem areas
You know your budget better than anyone else, so you should make note of any potential problem areas. This could be anything from the need to outfit your new office to the cost of daycare.
The sooner you address potential problem areas, the easier it becomes to hedge them off. Do whatever it takes to minimize the risk of a financial emergency or surprise.
3. Track everything
Nothing should change here. You should still track your spending, down to every last dollar, to ensure that you know where your money is going. If you’re struggling to keep up, use a budgeting app on your phone to assist you. It’s one of the best ways to save time, reduce headaches, and make more informed financial-related decisions.
4. Look for ways to cut back
If you come to realize that you’re spending more money now that you’re working from home, make a list of ways that you can cut back. It doesn’t have to be anything major. It just has to be something that saves you the right amount of money. Some ideas include:
- Eating out less.
- Finding a daycare that is closer to home.
- Turning off lights in your home when they’re not in use.
Consider any and every step you can take to cut back with the intention of saving money. As you look into all your options, you’ll come to realize that it’s easier than you think. And that’s when you can take action.
5. Tweak as necessary
Once you know how to cut back the next step is actually doing so. You should tweak your budget as necessary and as often as you think it will help.
One of the best ways of doing so is to review your budget at the start of every month. What looks good? What looks like it needs your attention? Are there any expenses you can cut out entirely?
Get into the habit of tweaking your budget when it makes sense to do so. Doing so gives you a good feel for your financial circumstances and the changes you can make to put yourself in a better position moving forward.
Tip: even if you have a firm grasp of your budget, there’s always a chance that something could go wrong. For example, if you run into a medical emergency, you may need money in a hurry. This could lead you to answer questions such as:
- How much money do you have in your emergency account?
- What’s the difference between a payday loan and an installment loan?
- Does your employer offer any benefits that could help you during your time of need?
Final thoughts
These are just a few of the top budgeting tips to keep in mind if you’re working at home for the first time. Once you settle into a routine, you’ll realize that it’s not much different than what you’ve done in the past. You simply need to make some adjustments here and there to ensure that your finances stay in a good place.