you have never made a budget before, this article will take you step by step through
the process. You will have a working budget sooner than you thought.
Get a small notebook to take with you. In it write down everything you buy for
at least a month. Up to three months if you'd like. I was shocked to see how much
our family spent on little stuff like vending machine purchases and magazines.
I found that most of our money wasn't being spent on big things, but the little,
"Oh, what's three dollars here or there."
time period is up, analyze your spending patterns. Put all your purchases in categories
like groceries, entertainment, etc.
those categories into two categories: Fixed Expenses and Variable Expenses. Fixed
are things like Rent and Insurance. The variable expenses are all those that you
have in your power to change like groceries, utilities and clothing.
Add up all the expenses in each of the categories. Write down the totals for each.
i.e. Phone: $58 a month
Add up all
your income for the month. Then add up all your fixed expenses. Subtract your
fixed expenses from your income.
Income:3,000-2,100 fixed expenses=$900
The result is what you have left for variable expenses.
Now you can
spread the leftover money into your other categories. Keep in mind yearly expenses
like taxes. Consider putting 10% into savings. Take a look at where you can cut
down. Enter the amount you have decided to spend in each category on your budget
worksheet. And now you have a budget.
monthly of what you spend in each category. I use Quicken to do that. Readjust
your budget if you need to. Only you know where your spending priorities are.
Further steps to budgeting can be found here.
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