How Difficult is it to make a Budget?
Budgeting is a scary word to many people. It is nerve-wracking because it means you have to stop spending money. It is scary because it means hours and hours spend bent over a spreadsheet trying to figure out how to save even more. They think that they could never do it because it's so complicated.
Is it really hard to make a budget? It can be, but if it's done right with the right tool, it can be a breeze, and it can be just as easy to follow it. Before you start budgeting, you need to know how much money you normally make and normally spend on a regular basis.
Income is probably the easier of the two to calculate. Most of us just have our weekly or bi-weekly paycheck, but this will also include interest income, dividends, investment gains, tips, bonus, etc.
Next, add up expenses just as you did income. Add every last expense from the smallest candy bar to the biggest payment, which is probably rent. If you don't know exactly, estimate the best you can. Preferably estimate up to get a more accurate count.
Once these are added up, subtract your spending from your income. If you get zero or just above zero, you are breaking even. You need to budget in order to start saving, especially if you want to get out of debt and feel more financially secure. A negative number means you are going further and further into debt each month.
If you're going into debt and paying for that debt with a credit card, you are in trouble and need to get this under control. If you have a large positive number, you are saving each month and that is great. With a budget, you can save even more and complete your financial goals even faster.
You can use any tool or method you want for budgeting such as software, excel spreadsheets, or a simple notebook and calculator. Just plan out how much you want to spend on what each month working around how much you want to save. To make it easier, be as specific as possible. For example, put a certain amount for entertainment, clothes, gift, etc.
When you start budgeting, you will find out that it is not as hard as you thought. The longer you do it, the easier it is. Keep at it and you'll make a habit and you'll find ways to be frugal with the things you don't care for so that you can buy the things you really want.
Is it really hard to make a budget? It can be, but if it's done right with the right tool, it can be a breeze, and it can be just as easy to follow it. Before you start budgeting, you need to know how much money you normally make and normally spend on a regular basis.
Income is probably the easier of the two to calculate. Most of us just have our weekly or bi-weekly paycheck, but this will also include interest income, dividends, investment gains, tips, bonus, etc.
Next, add up expenses just as you did income. Add every last expense from the smallest candy bar to the biggest payment, which is probably rent. If you don't know exactly, estimate the best you can. Preferably estimate up to get a more accurate count.
Once these are added up, subtract your spending from your income. If you get zero or just above zero, you are breaking even. You need to budget in order to start saving, especially if you want to get out of debt and feel more financially secure. A negative number means you are going further and further into debt each month.
If you're going into debt and paying for that debt with a credit card, you are in trouble and need to get this under control. If you have a large positive number, you are saving each month and that is great. With a budget, you can save even more and complete your financial goals even faster.
You can use any tool or method you want for budgeting such as software, excel spreadsheets, or a simple notebook and calculator. Just plan out how much you want to spend on what each month working around how much you want to save. To make it easier, be as specific as possible. For example, put a certain amount for entertainment, clothes, gift, etc.
When you start budgeting, you will find out that it is not as hard as you thought. The longer you do it, the easier it is. Keep at it and you'll make a habit and you'll find ways to be frugal with the things you don't care for so that you can buy the things you really want.
About the Author:
Starting a household budget is not difficult . Once you get the hand of it, it's easy. Use budget software and it's even simpler!
posted by Debt Consolidation Loan at
7:52 AM
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