5 Budget Categories you Should be Looking at Anually

New year, new goals! Today I’ve got 5 annual budget categories that you should be looking at each year. Each January, we sit down and re-evaluate our budget and our overall finances. This is a key step in helping us reach our goals! There are a surprising number of things that need to be adjusted annually. In fact, we can usually cut our budget just a little bit each year and then put that towards our savings! Many people don’t check in on important budget categories, like retirement. They also don’t think about how possible it is to negotiate their bills down.

So, today I’m going to share our annual budget categories to help you get your finances in order for 2019.

Disclaimer: I am not a financial planner or expert. All information in the post is my opinion and should not be used as financial advice. This is based solely on my experiences. Any action you take based on the recommendations from this blog is your responsibility.

If it ain’t broke, why fix it?

Many people get their budget in order and then leave it. However, you have to take real life into account and adjust as needed. Sometimes it doesn’t need “fixing”, but you can save money by adjusting.

If you’re anything like me, you are constantly evaluating your budget. We actually end up re-doing the budget every few months. We’re newlyweds, so getting it in order will take some time. The new year also can mean new insurance, or new taxes laws as well. It’s a good time to check in.

Changes can happen anytime. These changes can be from bills going up, to new income streams, to unexpected expenses…like my computer that just crashed! However, we like to make sure our long-term finances are in order each year. Life changes, so should your goals.

One of the biggest things we look at is our savings plan. I have a great post here about how the half-payment budget method helps us save for the holidays. It is never too early to start saving!

It’s important to take a look at your annual budget categories at LEAST once a year. Here are some categories and tips on what to look at and why.

Annual Budget Categories

Retirement

If you don’t have retirement savings, start one NOW. The recommended savings is about 15% of your income. Of course, that is just a recommendation, and each person has different needs, but it’s a good goal.

Personal Capital is the best, FREE tool out there to track your expenses. It’s perfect for annual budget categories. I was a little on the fence about putting all my financial information into it, but it tracks everything in one easy place. And, it’s totally free! I cannot recommend this tool enough. It tracks all your money, plus you get a free evaluation when you sign up. There is no better way to track your net worth and keep an eye on things. Check it out here!

Even with Personal Capital, I like to go onto every single retirement calculator that’s out there and plug our numbers, just to be sure. Since we have multiple accounts and types of accounts, I make sure that I plug the numbers once a year to ensure we are still on track. If not, it’s time to take a look at how far you are behind, and how you can adjust your savings to meet those goals.

Retirement is one of those things that people tend to put off because it’s so far away. You just can’t let this one go! The longer your money is in your accounts, the more money you will make. I have several charts that show how this works on my Pinterest board for retirement savings, which you can check out here!

Personal Investments

Long-term investments that are not for retirement should be re-evaluated, too. Many people opt for automatic investments, so it’s always good to check your portfolio and make sure everything is still on track! I find we usually need to make adjustments each year. Personal Capital can track non-retirement accounts, too. Again, I can’t recommend it enough.

Personally, I don’t really have any investments outside of my retirement, because I’m trying to max that out first. However, if you do have these, make sure you update your portfolio.

Personal Savings Goals

This is a no-brainer of an annual budget category. My husband and I are saving for a down-payment on a house. We have our own savings plan for how much to set aside each month, and how long it will take us to reach our goal. However, with fluctuating expenses and incomes, it is good to re-evaluate. This year we are checking in on how much we have, how much we need, and if that will still pay for the type of home we are looking for.

The housing market is fickle, so it’s good to keep on top of that. Check out my Pinterest board for Home Buying & Mortgages for some great tips and info. Just remember, the information is not necessarily from experts, so I’d double check with a professional before getting a mortgage.

Even if buying a home is not in your plan, you should check in on the goals that you do have. Are you paying off loans? Saving for a trip? These goals need to be checked in on to keep these annual budget categories fresh. Plus, it’s nice to see how far you’ve come compared to last January!

Insurance, Phones, and Cable

Many people don’t consider bills as annual budget categories. Shopping for car insurance is a pain, but you can usually find a better deal if you shop around every six months or a year. Switching companies can usually save you some money, so it’s worth looking into.

I’ve found this to also be true for phone companies. Many companies have a “switch and save” type plan, so if you’re a new customer you can score a new phone out of it!

Cable companies are pretty easy to call and reduce your bill, so that is worth trying as well. How great would it be to start out 2019 with an extra $100 a month because you took the time to make a few phone calls? I’ve also heard that visiting the locations in person can get you better deals than on the phone as well. It might be worth the drive.

Loans & Budgeting Tweaks

Loans are annual budget categories that can’t really be adjusted too much without re-financing. However, you should check into your progress. One of the best feelings ever is looking at where your loans were at in January of last year compared to this year. It feels good to make progress!

After you’ve made your calls and gotten the information, you should tweak the budget again. I like to look a little more short-term as well, if we can, and try to make adjustments as needed. Did you save money on your bills? Great, put it towards your loans. Not saving enough for retirement? See if you can shave a few dollars off a flexible category like food, or entertainment to try to and boost your savings. Start a gifts fund to pay for things like birthdays and weddings. Start a holiday fund so you have money for gifts!

Change is inevitable, so planning is key!

What do you do each year to help adjust your budget? Comment below!