HOW TO PLAN A BUDGET?

Want to control your finances? Then learn how to plan a budget properly. A budget is a plan that summarizes our earnings and spending habits so that we can track where our money is going. Budget will help us to stay on top of our spending so we have to be sure to stick to it.

Financial goals such as getting out of debt, saving for a house, saving money for retirement, going for a vacation, a budget will help us achieve this. I would like to rank my financial goals from highest to a lowest priority so that I’ll know which should be first to achieve and the last will be the least.

Below are some tips on how to plan your budget.

  1. Get Organized

Set at least 30 mins to one hour during your free time and begin planning your budget. Making it rush won’t give you a good result. Gather all the paperwork you need like credit card bills, bank statements, household bills, your savings and retirement contributions, and any other source of income.

  1. Add Your Income

Add your regular income from your regular job. Also don’t forget your side hustles, this is an income you get from your side work like freelancing, tutoring and other part time job if you have.

  1. Calculate Your Spending

This is were you calculate on how much you pay for mortgage, utilities, groceries, car, childcare, gym, travel etc. Much better that you categorize your spending so that you can easily allocate where your money should go.

  1. Create a Budget

Finally, create now your budget. From the above steps mentioned you will have a clear idea on how to create your budget.

Lastly, keep an eye on spending. Strictly follow your budget, self discipline is really important, without it you will really get a back slide on your budget plan. Come back and visit this plan every week and see how you can improve your budget.

 

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