Creating a Budget-Class Notes

Video Notes – Creating a Budget

Review Your Monthly Outflow

• Monthly Expenses
• Payments Toward Debt
• Use a Budget Worksheet

Calculate Your Income

·         Total Monthly Earnings

·         Include Usual Income

Create Your Budget

·         Subtract Your Expenses from Your Income

·         Evaluate the Results

·         Double-Check Your Math

·         Include Monthly Debt Payoff Amounts

Readjust Your Budget As Needed

·         Make Sure End Figure Is Reasonable (Do you have a positive number?)

·         Re-evaluate your priorities, if the end figure is not reasonable

Always Have Financial Goals

• Budget with the future in mind
• Track your progress on debt reduction and savings plan
• Pay into your savings first. You should always have a cushion, in case of emergencies or unexpected expenses

Use your budget

• Collect your receipts and track your spending for a month to create a plan for your budget
• Start using your budget
• Have self-discipline and motivation (I use a chart that constantly shows my progress toward my goals)

Appraise your budget

• Look at the results and your goal progress after a month and at 3 to 6 month periods
• Was it realistic? Did you make progress?
• Do you need to rethink your priorities?
• Re-evaluate, as needed (situations change, goals and dreams change)