If you ask someone about how to set up a budget, more often than not the stories you get back will be about complex calculations, keeping track of every cent you spend in complex spreadsheets or across huge accounting books, and being forced to live the life of a hermit with no luxuries or fun allowed. But budgeting doesn't have to mean any of that. Here are four simple steps you can follow to set up a budget that won't take you more than an hour or two to do.
1. Work out your average income for a month
You need to know how much money you get coming in every month (after tax of course). In some cases this is very simple (you just get a regular pay packet every month), but if you have a job with irregular income you will need to come up with an average figure. And don't forget that you may have other sources of income besides your regular job - be sure to include that income, if any.
2. Work out your average expenses for a month
This can be as detailed and accurate as you want. Getting everything down to the nearest cent may give some satisfaction, but is rarely necessary. For variable expenses, write down a best-estimate for the month. Be sure to create an "irregular" expenses category, for things that you only have to pay once or twice a year (perhaps subscriptions, or car servicing costs), and allocate a monthly figure to that category.
3. Make sure your income is greater than your expenses!
If it is - great! If not, you need to either work out what expenses you can reduce (but don't try to throw away all your luxury or "fun" expenses), or try to figure out a way to earn more money.
4. Allocate your money each time you're paid
Every time you get paid, put aside the amount of money you worked out you need to pay your various bills and expenses. You can put it in a separate bill paying account (and just use that account when paying the bills), keep the cash in a box in a safe or hidden under the floorboards, use the envelope budgeting method - whatever works for you. The important thing is to remove the temptation of spending that money.
Once you have separated off the budgeted money, anything left over is a bonus! Ideally you should put some of it away to build up a savings account, but the most important thing is you have enough money from now on to cover your bills without rushing around trying to cover the expense. After you've gotten used to this simple budgeting, if you want you can start to refine the process. But if this basic strategy works for you, why change it?
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The effectiveness of managing family finances has never been more significant, as parents struggle to find a balance between work and family life. A recent study by Mother and Baby magazine has found that new parents are getting less sleep than previous generations, with new mums struggling to manage their exhaustion.
Whilst there is no technological solution to sleepless nights as yet,
it is possible to assign many tasks which were once only possible
through physical movement, to the internet, such as shopping and
banking. No longer do you have to worry about co-ordinating the
demands of screaming children with your weekly shopping list or about
missing the bank at
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Whether you know it or not, you are always setting your financial priorities. Some may decide that a new stereo system is more important than this month's electric bill. This may be a little off the wall but it is still setting your priorities.
Anyone wanting to better manage their money would be wise to determine what their financial priorities are and stick to them. Of course, if you see that these priorities will not put food on the table and pay your bills then you will have to rethink your priorities.
Setting your priorities is simple. You just decide what is the
most important aspect of your finances and
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Every year thousands of families make a fresh decision to start living by a budget. They set up accounts on their home computer, begin to track everything they spend and set limits designed to help them save more and spend less.
Gwen Mathews is the Mother/Chief Accountant in one of these new budget conscious families. She and her husband Pete set up some ambitious financial plans with the goal of paying off their credit card debt. They split their family income up into categories and were doing just great. That is until the holiday season came along.
As Gwen scanned
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Are you one of those people who doesn’t open their bank or credit card statements? Do you take out store cards on the spur of the moment? Have you been with the same bank simply because it is less hassle than changing?
If you have answered yes to any of the above questions, fear not confused consumer, help is at hand, with some assistance from a few internet tools.
Websites such as Fool.com, Fool.co.uk and Moneysavingexpert.com
have proved extremely popular with
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A budget is a systematic plan for the expenditure of a usually fixed resource, such as money or time, during a given period. As a single mother you might groan at the thought of putting together a household budget with all your expenses, but it's easy to do and will also help you become very financially organized.
Shaping up your finances is particularly important if you are experiencing a life altering experience such as a marriage, divorce, new baby or any other event that changes your finances dramatically. Whatever the state of your financial life, developing a sensible household budget
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