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| Is it Hard to Make a Budget? |
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| Written by Samantha Asher |
| Wednesday, 04 March 2009 12:13 |
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Budgeting is a scary word to many people. It is nerve-wracking because it means you have to stop spending money. It is scary because it means hours and hours spend bent over a spreadsheet trying to figure out how to save even more. They think that they could never do it because it's so complicated. Is budgeting really that hard? It can be as hard or easy as you make it. Fortunately, with the right tools, you can make a very simple budget that is really easy to stick to. Before starting, you need to know how much money you earn and spend each month. First add up your income each month. Fortunately for most of us, this is very easy to calculate because it just means adding up our paychecks for the month. If applicable, add in interest income, dividends, tips, bonuses, royalties, and any other money you make. Now add up all your spending for the month. Write down every single thing you buy, no matter how big or small. The obvious expenses are rent or mortgage, utilities, food, debt payments, etc., but you must also include the variable and small expenses such as gas, daily coffee, sodas, etc. Now, subtract your expenses from your total income. A zero or small number means you are probably living paycheck to paycheck. It's important to start saving more if you want to pay off debt and get financially secure. A negative number is much worse. This means you are going into debt. If you're going into debt and paying for that debt with a credit card, you are in trouble and need to get this under control. If you have a large positive number, you are saving each month and that is great. With a budget, you can save even more and complete your financial goals even faster. You can use any tool or method you want for budgeting such as software, excel spreadsheets, or a simple notebook and calculator. Just plan out how much you want to spend on what each month working around how much you want to save. To make it easier, be as specific as possible. For example, put a certain amount for entertainment, clothes, gift, etc. Budgeting is not hard because it is actually meant to make things easier. Instead of worrying about how much you can spend, you know exactly how much. Also, you don't have to worry about running out of money for something important because you budgeted for it. Plus, you can adjust it however and whenever you want. About the Author: Starting a household budget is not difficult at all. Once you get the hand of it, it's so simple. Use budget software and it's even simpler! Kindly provided by LJ-Marketing.dk You are welcome to use this article on your own website, if you include the link just before this text. |
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