Categories would consist of groceries, rent or mortgage, utilities, insurance, and so on. Having these categories in place will allow you to see how much money you are spending a month on each item. Often, we do not know exactly what we are spending and most often than not, we are spending much more money that we had anticipated.
Once categories have been created, the next step in creating a budget is to determine how much money you desire to spend on each category for that specific month. Creating a budget is a really simple task. Within minutes and with a little brainstorming, you will be in control of your financial situation rather than it being in control of you. We all seem to dread the nauseating idea of creating a budget, so we procrastinate, putting off tomorrow what can be done today.
Yet, in reality, putting together a budget is quite simple and does not take as much time as anticipated. Now, that your categories are created, add a column and decide how much money a month you feel is necessary to spend on each item. For example, you may choose to spend 0 a month on groceries for your family. The goal is to not exceed this amount budgeted for the entire month. Once you finish one category, go through the rest of the list until all have a budgeted amount for the month.
Next, prioritize your category list. For example, take a look at your expenditures and write down what items are high priorities each month. These items will be your rent, car payment, insurance, etc. These items are at fixed rate. Most likely, these expenditures stay at the same amount monthly. Write down expenditures that you reduce your spending on.
Maybe, instead of spending 0 a month on groceries, you could use some extra coupons and only spend 5 a month. Also, decide how often it is necessary to eat out or what forms of entertainment you could cut back on. Use the majority of your monthly income to pay the high priority items and less money for the least priority items such as eating fast food, stopping off for a flavored coffee, or paying late fees at the movie store.
Money Chat is a brand new personal financial awareness series brought to you by Komunitikini, Malaysia’s leading online community portal. Hosted by Carol Yip, a financial coach and also author of financial books, the programme offers tips on how to manage your money wisely in easy to follow steps. Where needed workbooks and financial sheets can be downloaded free for your use. Money Chat contains three segments per episode – a short sketch of different spending scenarios, a how-to segment to help solve your personal financial book-keeping woes, and also chats with selected celebrity guests to see how they manage their money! For Segment 2 of Episode 1, there’s a link to a financial budget planner which is downloadable free to you! And the celebrity offering for Segment 3 is none other than radio and stage personality, Patrick Teoh! So how do you manage your money Patrick? Download the budget planner shown in the video here:- malaysiakini.tv Carol Yip’s two-in-one budget planner can be downloaded here:- malaysiakini.tv Read more in Komunitikini.com — komunitikini.com Produced by Indrani Kopal Camera: Maran Perianen Voiceover: Nick Josh Karean Music from – Kevin MacLeod (incompetech.com) Licensed under Creative Commons “Attribution 3.0″ creativecommons.org
Video Rating: 5 / 5
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Tags: brainstorming, car payment, creating a budget, creating a personal budget, dread, expenditures, financial situation, fixed rate, groceries, high priority