Creating a Budget.

When we think about creating a budget, we immediately get into a bored or negative state of mind. When we create a budget and stick to it, it makes it easier for you to save money every month or help you pay off your debts which will in turn diminish negative thoughts. More and more people are looking to budget their money. It can be overwhelming if you've never created a budget, so find ways to make it easier for you. There are many advantages to having a budget. It'll be easier to track when things are due. You'll want to avoid any late payment charges, which is not good for your credit and you'll have complete knowledge and control over all your finances!
First you should ask yourself why it is you need to create a budget. Are you spending too much money every month? Do you need to pay off a debt? Are you saving for travel or an event? Are you saving for retirement? Maybe all of the above. Whatever the reason, it's easier to stick to a budget when there is a goal set out.

Now you'll need to start organizing yourself. You may want to save all your receipts a month prior to creating a budget so that it'll be easier for you to track all your expenses. Don’t forget to review your credit card statements and to keep track of miscellaneous spending also.

Your next step will be to pull all your financial records out. Any investment statements or insurance policies. Determine how much money you bring in every month. This should include all your take home income from full time or part time employment to any interest you may receive through investments. Keep it all in mind.

You'll now want to categorize your budget by separating all the house bills, food, gas, car payments, clothing, miscellaneous etc. Figure out how much you pay for each monthly and then add them up. This is giving you the total of what you need each month.

Now compare your spending to your income and look for ways to improve it. Look at where you can reduce expenses and cut spending in areas that are a lot higher than you expected. A lot of the time you do not even realize how much you are spending on a monthly basis until you see it. Once you’ve allocated your money each month to ensure everything is paid on time, you'll want to save that additional money by opening up a savings account.

It is important to review your budget on a regular basis to make sure you are staying on track. After the first month take extra time to compare your expenses to what you’ve created in the budget to see where you need improvement and/or where you did well.

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