Wednesday, September 5, 2012

Effective Tips for Budgeting Each Month | FinanceDogma - Finance ...

Effective Tips for Budgeting Each Month

Nowadays, it?s essential to budget. It doesn?t matter what type of money you make, the economy makes it hard to save money. It is a good idea though to have some sort of budget to ensure you have a little bit of a stash in the case something happens. By having a budget set in place you?ll be able to plan for long term expenses as opposed to just seeing expenses for the current week. Here are a few tips to help you out.

What Method Will You Choose?

When it comes to budgeting, there are a lot of methods that can benefit you. There are a number of methods you can do on your own, but there are some people that choose to bring in professional help, and in some cases this gets pricey. Keep in mind that no matter what particular method you choose you?ll want to make the most of it. Make it a method that?s going to match your lifestyle, and something as simple as some paper and a binder might be all you need. You can use software on your computer such as Excel which is great for budgeting.

Determine Your Bills

Map out what bills you have from month to month. Determine what you have as far as income coming in each month and make sure that your income can cover your bills. Take each of your bills and write them down on a piece of paper or put them in an Excel spreadsheet. Keep in mind these bills do not include food. Only list bills that are a basic necessity each month such as your housing or mortgage payment and the utility bill. If you have student loans, this becomes a necessity bill as well. Your gym membership is not considered a necessity bill; even if you have been going religiously.

Now you can list out your food bill and your gas expense. You?ll also want to list out any items your home needs such as laundry soap and garbage bags. Try and be honest or else you won?t really do yourself any good.

Allocate Income

Think about what you make each month or what type of money you are going to expect for the current month. If you don?t know an exact amount, try to estimate. Are you going to have enough to cover y your bills? Do your checks help cover you for the month or are you short? If so, you might want to re-evaluate your bills and see where you can downgrade. You don?t need a gym membership or the premium channels on your cable.

When it comes to budgeting, especially in today?s economy, it?s important to make sure you can at least pay for the necessity expenses. It can be hard to part with some of the luxuries, but unless you plan on getting a second income stream coming in, downgrading is going to have to happen until you cna get back on your feet.

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