How to Make a Basic Monthly Budget
- 1
Find your monthly income.
Making a basic budget begins with what you earn. Find your monthly post-tax income. Most people have an idea of what they make, but they use their gross income as the basis for their budget. You can't spend money that will go towards tax, so don't even include it. If you have a job that doesn't have a guaranteed pay rate, look at your last three months earnings and get an average. If you have to "guesstimate", guess low. It is better to be pleasantly surprised with more money than you thought you would have to work with than trying to make ends meet with too little. - 2
Listing ALL your expenses is the key to a successful budget
List ALL your expenses that you have each month. A basic budget list will should include at least these following items:
Housing - include rent or mortgage, insurance, and utilities in this group
Food
Automobile- payments, insurance, gas, and a little bit towards upkeep in this group
Health insurance/ medical bills if applicable
Debts- list each loan or credit card separately
Entertainment/recreation -Gym fees, club fees, date nights
Clothing -even if you're not a big shopper, put aside $10.00 per month for each person in your household
Savings
School/child care
Miscellaneous- Maybe a gift fund for the occasional gifts or pet expenses if your a pet owner
Investments
Tithe or charitable giving - 3). Total up your expenses and compare your income to your out go. If the expense list is higher than your income, you can either increase your income or decrease your expenses. HIdden expenses often come in the shape of eating out, impulse buying, and credit card purchases that cause your monthly payments to increase.
- 4
Here's a sample of a budget worksheet found at http://www.vertex42.com/. This is different than the one I use, but still good if you don't want to make your own.
Make a budget list: Now that you know what you have to spend and what your bills are, make a monthly list that has a column for the bill, the due date (so you pay on time and don't incur late fees!) and what you actually spent. After a few months of budgeting, you will be tracking your expenses and finding any problem areas where you need to decrease or control your spending better to live within your means. Hopefully, you're already on track, but having a budget list will help you improve your financial awareness, keep track of your bills and make life simpler.
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