Creating a Personal Budget Summarized

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1. Explore your feelings toward money. Be honest and realistic.

2. If you have a partner make sure both of you agree on how to do the budget.

3. Make a list of all your expenses. Variable items such as groceries & utilities do an average of at least 12 months.

4. Don’t forget annual & semi-annual expenses.

5. List all income (net) that will be applied to the budget

6. Figure the difference in these two. If you aren’t making enough money to pay your bills you need to either cut your expenses or increase your income.

7. Write a simple budget. List all bills due or amount of money you are allowing for each expense. During the month note if you stayed within your budget.

8. It is helpful to keep a daily/weekly list of reoccurring variable expenses.

9. Study your spending habits. Is there anything you can cut back on or cut out? Can you eliminate duplicate or unnecessary expense?

10. Is your budget consistent with your personal financial goals? Are you saving money? Do you pay yourself first? Do you have a plan to pay off your debt? Are you preparing for college and retirement?

11. After working with a budget for awhile you may need to go back and make changes. Get help if you feel it’s needed. Explore computer programs designed to make budgeting quicker and easier.

12. Review your budget annually or any time there is a major change in your finances. Stick with budgeting until it becomes a habit.

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