Start Building Your Budget Today!-SaveMoneyGuides.com
The Author
Hey, my name is admin, and I first published 'Start Building Your Budget Today!-SaveMoneyGuides.com' on 11th August, 2008, within the Personal Financing section.
From-SaveMoneyGuides.com-1.) Do you run out of money before you run out of month?
2.)Do you sit down to pay bills and wonder where’s the money going?
3.) Have you ever realized that you might not have the money to fill your gas tank to go to work?
4.) Do you long for financial flexibility?
If you’re the type of person who always has plenty of cash, knows exactly where every penny goes, and never has trouble paying bills, then read no further. However, if you have answered yes to any of the above questions then you are in the right place. If you want to get your finances in order and gain more control over your money then building a budget is a necessary evil. I am not going to lie to you and state that you can be debt free in one or two years. I can tell you that paylesspermonth.com will help develop debt free solutions. Developing a well-planned budget is the only way you will be able to regain control over your monthly expenses. Although most people see building a monthly budget as a daunting task, when you get right down to it, building a budget is quite simple. A budget is not like Ronco Rotisseries where you “set it and forget it”; I assure you that if you build a budget and forget it, it will not forget you and you will realize it at the end of each and every month. Your budget needs to be a living document that is visited weekly in the beginning. As your spending habits start to tailor them selves to your budget you will be able to visit it less and less. With that said you should visit your budget at least once a month no matter where you are in the process. Starting the Process When you sit down to start building your budget there are three mandatory steps to starting this process.
1.) Identify how you are currently spending money. 2.) Write down your financial goals for the future and evaluate your current spending habits to see if they complement your goals. 3.) Track your daily spending for a period of one month and we will evaluate this information at a later time. Once you have these processes down we can now start the process of building a realistic budget based on the information you gathered.
Budget Building Tool
Remembering that our purpose here is to limit spending I am not going to suggest that you go out and buy any of the expensive tools like Microsoft Money, Quicken or any of the other expensive items. If you are reading this then you obviously have a computer and there are a lot of free tools out there that will help you build your budget. If you have Microsoft Office, iWork, or any of the other office suites you are in good shape. If you need a copy of an awesome office suite you can get a free copy of Open Office. Open office is a PC and MAC compatible office suite that is an awesome alternative to the high priced packages by Microsoft and Apple. I went through college using only a free Linux based operating system and a copy of Open Office with no issues. I am currently using iWork on a MacBook Pro.
Budget Building Pitfalls
One of the most common pitfalls when monitoring your spending by computer is what I call finance sensory overload. For some reason we tend to pay much more attention to multiple line items and forget to keep it simple when maintaining our budget. Remember we are working to determine which categories of spending can and should be cut or expanded. Concentrate on those categories and worry less about other aspects of your spending. One of the main things we want to be on the look out for is leakage or category creep. This is mainly noticeable in the cash line items. A big contributor to category creep is the ATM card. If you are budgeting and still using your ATM card you are setting your self for budgetary failure. Our goal is to keep cash on hand and stay with in that limit. If you are visiting the ATM at more than once a week then you need to re-examine your spending for the week. When gathering your information and building your budget please be aware of your necessities and know what are luxuries disguised as necessities. If your income is not covering your costs, then some of your spending is probably for luxuries. When determining the amount of money you can live on, don’t include monies that you can’t be sure you’ll receive; this type of money usually is in the form of year-end bonuses or tax returns.
Don’t spend any money before it is in hand.
