Set up a Simple Budget, it’s Your Money!

I was always someone who was dead set against budgeting. I think that was mostly because I was younger and just didn’t realize the importance of setting one up.

I had more money than bills at that point in life and I just didn’t care about finances. But now that I have a lot more years under my belt and have all of the bills and things that go along with it, I realize that a budget isn’t something you make up to limit your spending. A budget is something you make up to be sure that you spend wisely and to let you know where you stand as far as your bills, other debts and savings are concerned. (You can opt to leave out any savings items from your budget if you want to, just don’t write any of them down. Simply take any extra cash each month and save or spend it like normal.)

So let’s get a spiral and make up a quick budget sheet you can use for every month of every year, to let you know at a glance where you stand financially for the month. This will enable you to save more and be able to afford more things that you want or need.

Let’s start by creating a spending sheet for your spare cash. You will only make one of these when you need to figure out what things you can eliminate or to figure out how much you spend in a month on a particular item, such as groceries, or clothes if you are not sure how much to budget every month for things like those.

Just label a page “Spare Cash” and every time you spend money write down what for and how much. Put down on this page everything you bought down to the penny, use several pages if you have to, and you will quickly see after a couple of months, just where all the spare money you have left after paying your bills, is actually going.

Someone I knew did this and found out that the candy bar they bought ever day after lunch, could easily pay their cable TV bill! They quickly gave up the candy to pay for the cable and they also lost weight by doing so. A Doubleheader!

You will be surprised to see just how much money you spend on things and may even end up with more money than you ever thought you would have, just by finding and then cutting out a few unnecessary items.

Once you have done this until you are satisfied that you know where your extra cash is going, we can now start to keep a budget. (You can actually skip the “Spare Cash” part and get straight to the budget if you want. But if you are ever wondering where all that extra money you may have each month is actually going, then make one up. It’s a real eyeopener!)

Now take one page and write the month and year across the very top. Draw a line down the middle, seperating it into two long columns.  On the top left,  label it “Income“. List all of the income you expect to earn after taxes for this month. As close to the penny as you can figure. Every dollar you know you will earn or get from somewhere or someone to bring home to spend this month.  Total up this column.

On the top right, label it “Expenses and Savings“. This is the column where you will list every expense for the month or anything you are saving for or making payments on. Put your most important bills first. Then list things like donate to charity, club dues, and anything else that cant hurt your credit or wont involve a penalty or late fee. They go on last. These are the things we can skip once in a while then catch back up on later. Everything you will spend money on or save money for in a month gets labeled and has an amount in this column. From bills, to food and clothing, to lunches and movies, to bank savings accounts and investments. Use the back of the page or more pages if needed.

When doing your budget, you can choose only to include the major items, if your the type of person who doesn’t sweat the little things and just spends pocket cash for movies, gasoline and such, or you can include everything you will put out money for and budget down to the penny! It’s up to you but even if you only include the have to pay expenses, at least you know if you are covered for those!

Once you have the total amount for everything you spend or save for in a month, including all of your bills, rent, car payments, utility’s, cable, food, clothing, gas, lunches, doughnuts, movies, bowling, pop, new sheets, tools, work clothes, savings accounts, get well soon cards from work, donations, lent money, anything- IRA’s etc., than you can figure out just where you stand financially for the month. So total this column, now.

Here is where we boil it all down and see what we have to do to pay for everything monthly. Subtract the total of the “Expenses and Savings” column from the total of the “Income” column and this will give you a total dollar amount that you will be either short or over for the month. This is an important number to know. It tells you whether or not you can afford everything you listed in the “Expenses and Savings” column for that month or if you have to hold off spending money on something until next month.

Learn to adjust the dollar amount for items listed near the bottom of the  “Expenses and Savings” column for each month. You can put in things that you are saving for every month, like an expensive vacation and adjust that amount to be less or more every month to cover other bills if needed. You can make an extra small column to the right of (Expenses and Savings) and use it to keep a running total of how much you have saved or spent for each item through that month. This way you will know when you will afford the item or how much you spent on something so far and your budget now becomes a Spending and Savings record log also.

Budgets are great because they actually put you in control of your money. If you have enough money for all the necessary things after eliminating the unnecessary things, than you are doing good. But if you are short on paying a few bills for the month, than you can use your budget pages to easily figure out just what you can cut or who can wait to be paid so you can pay those bills.

When dealing with creditors it’s a handy tool to let you know just what you can afford as far as a reduced payment is concerned. Deal with your creditors and tell them your whole story and they may very well cut you some slack, especially if you know just what you can afford to pay them without getting behind on all your other bills.

If you get laid off and start to collect unemployment (make sure you have them take taxes out of your check) then redo your budget with the new income figures and see just what else you can eliminate in order to get by on the lower amount.

Remember, budgeting is nothing more than putting a jar on the table for each thing you will spend money on or save money for during that month and then taking all of your money and filling up the jars as needed. The only difference is that you are writing the jars on paper and writing in the money, that’s it!

Putting your finances on paper like this every month will help you control your money and why not control it, after all it’s yours isn’t it!

You can even get generic budget books at office supply stores or make your own custom pages with everything you need on them and have them copied so all you have to do is put in the amounts for each month. Make sure to leave a little extra space in the columns for any extra items that may crop up. Copy a dozen or more for each year and you will be set to spend your money wisely!

HOT TIP. If you are having trouble with several bills being due close together, than call each company and explain ( to the manager ) how all of your bills due at once is a hardship for you and ask them to adjust their due dates so they will be all be spread out during the month between your pay or unemployment checks.

Here is a link to News Radio950’s online budget calculator, It’s good but not as complete as your own budget on paper, but it may help with your own.  News Radio 950 Budget Calculator

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