With the worldwide financial crisis in full swing, now more than ever it is time for you to create and maintain a budget. In doing so, you can pay your bills, set aside for retirement and avoid the troubles of financial debt. Personally, I do not like the word “budget”. Never. But without a handle on your money you’ll probably end up like most people, living paycheck. Mis-managing your money can make you lose control to the point of despair. That’s because you’re not in control when you do not have a clear plan for YOUR money. Take control of your life and YOUR money. Be smart. Heck, it’s your money and you have probably worked hard for it. There is hope and a clear plan of attack, you’ll feel better in life, those around you, and even yourself. Let’s get started …
You need to know what your income is. So even if it is a rough estimate, you’re on commission sales, at least try to figure the minimum of what you could possibly do. If you do more, then you can deal with later. So now make a list of your monthly income. Remember to include other forms of income which may include child support, alimony, and use the other.
Then, list your monthly expenses. When you are calculating the costs, do not forget to include transportation such as gas (especially since it is rising), utilities, food or entertainment. Obviously, you should have included in your calculation, rent or mortgage costs, insurance such as car. To help you with what you can download our form of budget.
It might be useful to calculate your actual expenses or sitting down every night ever-so-often and write down your expenses as they occurred in recent days. This will help you get a more accurate picture of your monthly expenses. You might be surprised how much you actually spend.
Another trick is to try to save your receipts. Just put them in a shoebox for the week and add them over the weekend.
Now … Your income to cover all your expenses? This is called “cash flow”. If more is “Out” what is to come “In”, then “Houston – we have a problem.” I hope we can resolve this with some adjustments. If you find that your expenses exceed your income actually do, then you must reduce your expenses.
Time to adjust your spending … Depending how far you are off balance (income over expenditure), there may be a simple adjustment of cutting back on your entertainment expenses or reduce the movie channels on your cable bill or even your cell phone. This may require a temporary plan to let us fly to the end of the world. Make the adjustment.
If, however, the difference between what you spend a lot bigger than what you take home, then you may need to consider selling your car or maybe even make different lifestyles. It does not matter. Really it is. You will. Believe me, when you take control of your life you’ll feel better. I know, I’ve been there. The reason you can even feel sick, discouraged or depressed because you still feel out of control.
Take control of your life right now. You’ll feel better, I promise!
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