Back to Budget Basics

Let’s get back to basics. Budgeting seems to be a lost art and with credit card debt at an all-time high in the US at $930 billion, we could all take a better look at our finances and make some adjustments.

First start with your actual net income. Do you have one income and provide for your whole family? Do you work two jobs and have a side hustle? Do you receive child support? Be sure to think about any areas you receive extra income every month.

Once you have this established it’s time to list all your monthly expenses…utilities, mortgage/rent, car payments, student loans, credit card payments, medical bills, wifi, etc. Even the small bills! Don’t forget about Netflix, Disney+, and any other monthly subscriptions you have. These are easy to forget since we don’t think of them as a large expense but they still add up quickly. (This would be a good time to see if you even use all of these subscriptions. Anything you can cancel?) Estimate your monthly grocery spending as well. Also don’t forget bills that you may only pay quarterly or yearly. These may be your home insurance, car insurance, HOA fees, etc.

The end goal with a budget is to make sure you are not living over your actual income! Paycheck to paycheck is hard enough but if you don’t have a good grasp of where your money is going, it’s hard to get ahead. This may be a time in your life where the main goal is to prioritize “needs” over “wants” for a while. Set a 6 month goal for yourself that you will be disciplined and eat at home more, or cancel your tv subscriptions for a few months and find other ways to save and invest for the future and watch your savings grow.

Start your budget for one month and see if it needs any adjusting for the following months ahead. Take the time once a week to see how you are doing. Invest in yourself. Read and gain knowledge on saving and investing for your future. Set a reward for sticking to your plan. Since you’re eating at home more, maybe after a successful month you take yourself out for a nice dinner. Invite a friend to celebrate with you.

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