Develop A Budget
Figuring out how much money comes in is pretty easy, but figuring out how much you spend might take a little effort. First, collect all your bills, this includes your credit card statements, your check book register, and receipts for gas, groceries and anything else you buy with cash, check or a debit card.
Don't forget about items that are billed less regularly, such as taxes or insurance. If you don't keep receipts for some of the items listed you may have to wait a month or two while you collect the bills required use a notebook to make sure you record every receipt or use a money management program on a computer.
Use This Budget Checklist
- Mortgage or rent statement
- Check book register
- Car payment book or statement
- Receipts for gas, groceries, childcare, etc.
- Utility bills (light, heat, water)
- Insurance statements
- Credit card bills
- Savings passbook or statement
The three types of expenses can be divided into three categories:
- Fixed
- Variable
- Flexible
Did you know not all budget items are equal. Fixed budget items are the same each month, such as your mortgage. Variable items change each month, like your credit card bill. Flexible items are often controlled by your willpower, such as whether you go out to eat or to a movie on the weekend, and how much you spend there.
TIP
Saving adds up - Why save? For emergencies (most financial planners recommend you have at least six months' worth of living expenses set aside). Saving will also help you reach any special goals you may have but maybe never had the money to achieve - such as saving for the down payment for a new car or home.
| Learn About: | |
|---|---|
| Living Within Your Means | Shopping Within Your Budget |
| Budget Glossary | Research The Right Vehicle |
| Why Budgeting Works | How to Develop a Budget |