12/29/2022 0 Comments You need a budget budgetYou’ve just taken the first step toward improving your financial life. It’s perfectly common to learn that you are spending more than you make after completing your first budget. But if there’s nothing left of your income or you’re spending more than you earn, then it’s time to examine your budget and make some adjustments. Ideally, you will have a surplus, meaning you’re spending less than you earn. Now it’s time to do the math by subtracting your total expenses from your total income. Your list of expenses should also include debt payments and automated savings. When writing down your expenses, don’t forget to include bills you only pay a few times per year. Flexible expenses vary from month to month, like your electric and grocery bills. Fixed expenses are the same every month, like your rent or mortgage. Next, document all your fixed and flexible expenses. If your income is comprised of sources beyond your income -like child support-include those sources as well. That’s how much money is left over after payroll deductions, such as taxes and health insurance. To start a budget, write down your NET income. Sometimes it can be hard to plan ahead, but doing so now can help you avoid the horrible feeling of NOT being able to make ends meet. It can also help you plan for long- and short-term goals. Keeping track of your money’s movement can help you avoid spending more than you earn. Think of budgeting as a living, breathing, ever-changing document of all the money coming in and going out. But budgeting is less about math and more about record keeping and self-control. And for some of those people, the idea of doing math is the scariest part. For many people, budgeting is a scary word. Now that you know exactly how you are spending money you can create an accurate and useful budget. Our spending log you can print to use at home will help you track your purchases. Next, categorize your expenses into things you need versus things you want. To help stay on track with your spending, write down everything you spend money on for at least one week (a month is better), including the smallest purchases. Managing your money requires a balancing act between spending now and saving for later. #You need a budget budget tv#We carefully consider big purchases, like a new TV or cell phone, but we don’t give much thought to buying a bottle of water when we forget our reusable bottle at home. Most of us are fully aware of how much we spend on the major expenses, like the mortgage and rent, but do you know how much you spend each week on snacks, drinks, and entertainment? It’s the small expenses that tend to accumulate and break our budgets. Tracking Expensesīefore you can create a truly useful budget, you need to know where all your money is being spent. It simply allows you to adjust your spending habits, look for other sources of income, and reduce expenses to give you more breathing room to live the life you want. Budgeting doesn’t mean removing all the fun from your life. #You need a budget budget how to#It allows you to see the whole financial picture and decide how to prioritize your expenses and make the most of what you have.Ĭreating a budget and sticking to it can be difficult, especially if you’re new to the process. But writing down a budget is a good idea. We all have a general sense of how much money we have and what we can afford to spend. Everyone uses a budget in one form or another. Creating a budget and sticking to it can help you reach your goals. A budget is simply a plan for your money.
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