![]() Step 4: Use Your Budget To Get Out Of Debt.Step 3: Cut Out Unnecessary Expenses And Build A Strategy.Step 2: Write Down Your Monthly Expenses.Step 1: Determine Your Minimum Monthly Take Home Pay.So without further ado, here are the steps to make a budget and stick to it. However, after a couple of months, you will get the hang of it, and your monthly budget will only require a few minor tweaks. While a budget may sound intimidating, there are a few necessary steps to create a budget, and I will break them down for you.įull disclosure: the first month you do a budget, it will be very time-consuming. You must at least look over your budget each month to make sure nothing has changed, and you’re still on track to reach your financial goals. A budget is not a set it and forget it type of plan. So how do you make a budget? Budgets should be written down and reviewed each month because monthly income and bills may change. A budget tells your money where to go, rather than wondering where it all went. With fun money, I can do this without any guilt or credit card debt. I can also decide to save it up and buy something totally ridiculous that would generally be a waste of money. That means I can either spend all that money each month on junk food and video games. It’s an amount of money set aside in the budget that we get to spend on whatever we want without any guilt. My wife and I each have a set amount of fun money we get each month. It gives you an outlet to be a little less responsible while being responsible at the same time. There is a secret budget fund known as “ fun money.” This fund allows you to spend money on junk – just because you can. The truth is, you can have a budget and enjoy life at the same time. In reality, your golden years will not be so bright if you live for today and ignore tomorrow. If you live for 20 years after retirement by relying on a pension alone, the cost of living raises may not keep up with inflation. Can you afford to live on social security alone when you get to your golden years? Some people survive on social security alone, but I certainly wouldn’t consider it “living.” If you fail to plan for your future – you will not have one. ![]() Living like you’re rich now means you may be living like a pauper when you’re older. If you live in the moment, you will have no future when it comes to your finances. This rationale is based on the fear of the unknown and burying your head in the sand to ignore a problem. “Why shouldn’t I have fun with my money now while I’m young and healthy? Who knows what could happen in the future, I could die or become sick and be unable to enjoy life.” I have heard countless remarks from friends who state, “I can’t take my money with me,” or, I felt budgets were restrictive, and I worked too hard not to enjoy my hard-earned money. All work and no play is awful, and I felt a budget meant no eating out, no video games, and no freedom in general. Why You Need A Budgetīudgets have a negative connotation with them, don’t they? In my early days, budgets meant no fun. I was not telling my money where to go, and instead, I was always wondering where it went. I was working hard, but I wasted my money on things that didn’t bring me value. Now that I look back, I was not winning in fact, I was losing every month. If I still had a couple of bucks left in my checking account at the end of the month, I considered that a win. My main goal was to spend less than I made each month. When I was younger, I didn’t believe in a budget. Your budget is the first step in taking control of your life and finances to eliminate your debt and begin building wealth. The best personal finance advice I ever received is “personal finance is personal.” Each person’s budget will be different from the next one. If you have a savings goal you are trying to hit or are tired of living paycheck to paycheck, a budgeting plan is the first step to reach financial freedom. This article includes everything you need to know to get started with a monthly budget. This free budget worksheet will help you get your finances on track. Before we start, get your free budget printables here. This article is a step by step introduction for how to create a basic budget so you can improve your financial situation. It’s time to learn how to make a budget and stick to it. You have either fallen off the proverbial financial ship or are taking on water and sinking slowly without even realizing it. If you don’t have a budget, you are living dangerously. Failing to plan is planning to fail – Benjamin Franklin
0 Comments
Leave a Reply. |