Tips on How to Budget your Money

budget

Imagine that you have a salary of $1,000 monthly. With this income you have to pay your apartment rent, electric and water bills, transportation expenses, taxes, and other necessities you require.

Is this money sufficient? How much money are you keeping? Planning a budget will help you to manage your money. According to a recent study by U.S. Bank, 41% of Americans say they use a budget – up from a Gallup poll in 2013 that put the percentage at 32% – or one in three households .

A budget is a document enumerating expected receipts and payments in a given time. It can help you when money is tight. So how to make your budget?

Set a Goal

Ask yourself what do you want to reach at the end of the month? at the end of the year? Are you planning to purchase something? Be specific with your goals, whether to use short-term or long-term goals. These questions will help you visualize the amount of money you should have before your deadline.

Expenses & Necessities

List all of your monthly expenses along with their amounts. You may refer to your old bills to determine the value. Add any other items that interest you. Don’t forget to calculate any money you want to save. What is the purpose of planning if you don’t have any savings?

You may also want to check the calendar for any holidays. Or prior to making this budget, whether you have planned a trip or other activities.

Emergency Purposes

Sometimes we cannot control what will happen on the next few months, where unexpected expenses or other financial emergencies occur. Times like these can lead to requesting an employer for a salary advancement or exploring the option of a payday loan. We’re not all born with impeccable money management skills or the ability to save for a rainy day. In many cases, the income simply doesn’t allow it. But when funds are short, there are options until payday, and knowing these matters.

In cases like this, we need to re-do step #2 because we need to combine the amount to repay our loan or we may deduct the amount to our salary. It will depend on your discussion with the company on how you will repay the loan; how much will be the interest; and the allotted time to complete the payment.

Just be mindful because some company charges a high-interest fee. So before signing a loan, you and the company understand each other term of payment.

Managing your finance includes planning, administering and controlling. And budgeting your money can be very complicated. But when you get the hang of it, it will be an easy breezy to spend on the things you want in the future. Just don’t get lost on your tracking and stick with your plan.

For additional help on how to start a budget;

How To Budget: A Simple, Flexible Method For Everyone
Budgeting 101: How to Start Budgeting for the First Time