To reiterate what I started yesterday, if you make $45,000 a year and you spend $55,000 – that’s not good. You will end up broke.
Budgeting your money is not difficult, but it must be done. It doesn’t take long, once you start doing it.
It’s best to do it just before the first of the month. Let’s assume we’re doing a monthly budget. Ready?
At the top of the page, list what your total incoming income will be during the month. Use net income, as the taxes, etc have already been taken out. Once that is done, list all of your bills below that, starting with rent/mortgage, auto payments, utilities, and ending with student loan and credit card payments.
If you have any left over, don’t start jumping for joy just yet. Let’s think of some other expenses you may have: fuel for your vehicles, food, charitable giving, and miscellaneous.
When it comes to food, I suggest overbudgeting for this, because, depending on your family size, you may be amazed at how much food you’re consuming.
How does it look? If you’re in the negative, you’ll have to do one of two things: first, go through the budget to look at areas to cut; second, find ways of increasing your income.