How to Make a Budget that Works for YOU

Not sure how to make a budget? Never needed to know before?
Many of us do not get into good financial habits. Perhaps money management education should be part of the school curriculum, but really, if we didn't pay attention to some of those other subjects then why would we take an interest in money management. After all its usually parents who hold the purse-strings.

• Do you wonder where the money went?
• Do you want to control your finances, not the other way around?
• Would you like to plan your spending more effectively?

How to make a budget - getting started.

A HEALTHY BUDGET is one where INCOME IS GREATER THAN EXPENSES

How to make a budget / Home Budgeting - 3 Rules

1. Write your budget down
   Write your budget on paper, in a book or on your computer. (see FREE budget planners below) You can choose, but ensure it is easily and readily available and allocate a regular time in your schedule to add the information.
   
   NOTE: It's so easy to think you have accounted for everything, but memories play tricks. To ease adding up, round figures up or down to the nearest 10 pence/cents, but rounding to the nearest whole pound/dollar can result in skewed information.


2. Track your spending in categories
   Writing down your expenses in categories such as fuel, eating out (include take-out meals), transport etc,, makes it easy to pinpoint exactly how you use your finances and allows you to cutback and economise where necessary ...or to divert and allocate funds for future plans


3. Record / write down your accounts regularly and often.
   Track them as often as necessary e.g. weekly, two-weekly, monthly. Track both credits (incoming) and debits (outgoing expenses) to make sure everything checks out.
   Even if you pay your bills online, include them in your budget record. This will keep your money in focus.

Once you have sufficient accurate information to hand you can begin to identify the best ways to save money, and implement strategies to save money.

FREE budget templates, FREE budget planners

OpenOffice (download it for free here) have a good selection of templates for you to use along with their FREE software including:

Personal Budget planner
Use this Personal Budget spreadsheet to create a yearly budget and track your expenses from month to month. This type of budgeting is useful for planning large purchases or making major life changes (like moving, marriage, kids, school, changing jobs, etc).

Family Budget template
A family budget and expense record to help with planning and managing household expenses.'
This budget allows each spouse to create personalized expense categories and to record expenses individually.

Monthly Budget planner
Budget Worksheet - comes with suggested categories, but all can be edited to suit your exact needs.

Decision Time! - How to Make a Budget Work for You.

What services do you currently buy that you could do yourself - e.g. can you really afford the gardener or your dog's monthly pamper. As you make these decisions, take the necessary actions to effect the changes - cancel direct debits, standing orders, cancel service agreements.

Return from How to Make a Budget to Happiness Pirates.