5 Step Guide For Creating A Personal Budget That Works

Published on January 22nd, 2019

Raise your hand if you’re excited to sit down at the dining room table and put yourself on a budget. That would be no one, right? We’d like to change that. Believe it or not, creating a budget is freeing.

In the course of a month, we don’t see how we waste hundreds of dollars on frivolous purchases. A budget can remove the frivolity and swing open the doors to travel plans and down payments. Read on to enjoy a simple step by step guide to financial freedom!

1. Download A Budgeting Tool

Expenses

Nowadays, there are so many apps out there designed to help us pinpoint the weak spots in our finances. They have the ability to hold us accountable to the areas where we overspend.

Best of all, they can link straight to our bank accounts and do all the assessment “behind the scenes.” Start with something this tiller money review from Investor Mint and then take your pick. There are countless apps out there to help us smash the new year with financial prowess.

 

2. Create A List Of Monthly Expenses

Your new app will have a section for this. You’ll want to record all your monthly expenses. Some considerations are:

  1. Mortgage/rent payment
  2. Car payment
  3. Car insurance
  4. Utilities
  5. Cable/internet
  6. Student loans
  7. Credit card payments

Don’t guess on these numbers. Pull out last month’s statements and get an exact number. You will, however, want to estimate the other items that fluctuate each month like gas and groceries. But, be sure to include them.

 

3. Annotate All Your Income

Reduce Your Daily Expenses

Is it as straightforward as a bi-weekly paycheck? And does that paycheck never vacillate? Record the fixed amount you receive after taxes.

Then, consider any extra income? Do you have a little side hustle? Review your old paystubs to make sure this is a number you can count on month by month.

 

4. Make A List Of Needs Vs. Wants

Now, it’s time to roll up your sleeves. Make a detailed list of needs vs. wants. Rent is a need. The car is (most likely) a need. What about cable? Is that a need or a want? What about wine and cheese night? Is that a need or a want?

These are the kinds of things you need to be brutally honest about. If you have a sincere financial goal in mind, then you’ll have to get sincere about your needs vs. wants and strike out those sushi nights for the time being.

 

5. Review Your Budget

Track Your Expenses

The fun doesn’t stop there. Be sure to go back and review your budget at the end of each month. See where you went over. (Perhaps that should be moved to the “wants” list.)

See where you were successful. Perhaps that’ll move the needle in terms of savings goals. Just remember budgeting isn’t a stagnant process. It’s important to come back and level the playing field each and every month.

 

You Step By Step Guide To Success

Go buy that bikini. With this step by step guide to financial success, you’re well on your way to that dream vacation in India.

In the meantime, keep coming back to visit us! We’re your source for trending lifestyle, entertainment, travel, and technology stories. And we can surely help you put all that money you’re about to save to good use.

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