These may be necessary, such as electricity, but the amount needed will change each month. Variable expenses will be different from month to month. These may include school pictures, new tires for the car, and sick appointments.įixed expenses will be those that will remain the same each month.Įx: rent, mortgage, transportation, basic utilities, insurance, minimum loan payments Begin to categorize your expenses and do not forget that there will be surprise expenses. There will be fixed and variable expenses. Consider this the money that flows out of your household each month. Net pay is the amount you are paid after taxes.Ĭreate a list of expenses. ![]() Paychecks, grants, scholarships, alimony, public assistance (SNAP) and child support are a few forms of income that should be included. This is the money that is coming into your household. Step 1: Count income.Ĭount all streams of income. When creating your budget you will need to consider all income and expenses, prioritize by needs and wants, and made lifestyle decisions. This allows grace as mistakes are made.Ī budget includes all incoming money (income) and outgoing money (expenses). Before you begin to create a budget, you must accept that it will not be perfect. Making a spending plan can be intimidating. A budget is a plan of action for achieving your goals because you are being intentional with your money. This should be done before any money flows in or out for the month. You decide where your money goes when you budget.Ĭall it a budget or a spending plan, you need to create one each month. You are telling your money where it should go. ![]() Budgeting is a repeated process where you create a plan to spend your money. ![]() Budgeting creates the groundwork for every financial plan.
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