How do I Start a Budget?

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Starting a Budget


Starting a budget for your household can be exciting, fun, stressful, strained and eye-opening all at once!  If you have never used a budget in your household, this article will give you some good information that will help you get on your way!  The following steps are crucial to your success if you are going to start a formal budget in your household.

  • Enlist the support of your spouse/significant other.   If you don’t have the support of your mate, this is going to exponentially more difficult.  You cannot achieve a successful budget without their buy-in, regardless of how submissive they may be.  Seek them out, explain what you want to do and ask for their help.  Even with a little initial resistance, you can win them over if you approach it correctly and show them the benefits they will receive for their participation.
  • Know your income. You need to know how much money is coming into your home every month.  This becomes the top line of your budget.  Everything below the top line hinges on the accuracy of the top line!  Make sure that you know how much is coming in from every single source of income that you may have.  This may include things other than the wages from you and your spouse’s occupations.  Declare every single dollar.  We want to assign each of them to a specific expense.
  • Know your expenses. What are your monthly bills?  Who do you owe?  How much do you spend on groceries?  How much is your electric bill?  How much do you spend on clothing?  Do you know exactly how much you are spending for each and every item in your budget?  Chances are, if you don’t maintain a budget currently, this will catch you completely off guard.  After you have solicited the support of your spouse and identified all of your income sources, you need to list out each and every one of your expenses.  It is as simple as putting them on a piece of paper so that you can see exactly what they are.  If you have not done this in the past, the easiest way to do it is to keep every single bill that comes in the mail for the entire month.  As you pay your bills, list them out one by one on a piece of paper.  At the end of the month, check to be sure that all of your standard bills are reflected.  Then, take your credit card statements, check register and store receipts and use those to calculate your living expenses by line.  When you are done identifying your expenses, add them up.

If you have never kept a budget before and have successfully completed the three things mentioned above, you are at a good stopping point.  Take a moment, take your left and, reach over your right shoulder and gently pat yourself on the back, you deserve it!  You are ahead of many people in the country if you have done these things.  There will certainly be more articles coming in the near future about budgeting, but for now, you are done.  Take a look at your lists and see how your monthly bills compare to your income.  Is there anything left over?  What can you do to make that number larger?  Those are the things we will be telling you very, very shortly!  We will tell you however, that our next article will tell you the list of items that should be in every monthly budget.


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