Monday, July 13, 2009

Planning a Budget

We have a major project coming up that will have us using money differently for the next few months. In order to keep everything straight, I've been creating budgets. I've never done this before. When I've asked others (even at a bank) for a worksheet to follow, there are none to be found. Hmm, maybe the cause of our economic problems in the country. Maybe if we taught people how to budget and manage money, there wouldn't be so much debt in our society. Sorry for the diversion, but that's what come to mind. So with limited knowledge or guidance on how to really create a budget for our project and created one of my own. It's not fancy and I hardly remember how to use a spreadsheet, but that's coming back. In creating one for our project, I realized I had to create one for our personal expenses, too. I did this by month. Here are some tips on creating a budget.

1. Write down everything and how much you think it will cost. I like to estimate high, just in case something costs more. Also, don't forget to include tax.
2. Break it down into categories. For our personal budget, I have shopping, bills, personal, grocery, etc. For our big project, I included categories, such as payments, allowances, additional cost, future costs.
3. Create a column on your budget that has "difference" of what was spent. This will guide you in future budgets.
4. Balance your checkbook. Okay, this isn't really a budget tip, but so many people don't. I use a software program called "My checkbook." It works great to keep the checkbook balanced. It is a simple program and doesn't cost much $20.
5. Stick to it. Not just by spending within your means, but by recording every purchase you make. You will be much more aware of how much you spend and how much you save!

I suggest if a full household budget it too daunting of a task. Start simple. Budget just one category to begin with. Start with bills. These are about the same each month. Try that for a month and add a shopping budget.

For more budget tips, Money Saving Mom posts often on this topic!

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