Rather than having just 1-3 categories of items budgeted for, we are going to create as many as we need to put a limit on our spending in all areas. To do this, we are just going to expand on the lazy man’s budget mentioned above. Yes, this method takes a little bit more time and energy, but it will also provide you with long-term financial benefits if followed. So, since you are NOT lazy and are hungry for more of a challenge, let’s look at how the pros budget. I think it should be considered the “lazy man’s budget” – and you are not LAZY and you are willing to work to get your finances in order!! I know this because you are still reading. That said, it is still inefficient and leaves the door wide open for inefficient and foolish spending. It is simple, doesn’t take up much time, and will help you reach some savings goals. I think this budget is perfect for people who don’t want to budget. government takes our taxes directly out of our paycheck, rather than coming to collect the full sum at the end of the year? It is the same principle – use it to your advantage. There is just something about human nature that has a hard time staying consistent with things like this. I highly recommend making this process automatic by using direct deposit or some other form of automatic withdrawal. If not, I can almost guarantee that the full amount will not make it as intended. It is absolutely critical that the money gets taken out FIRST for these few budgeted items. = $800 (for the rest of the bills and everything else) For many people this is tithing to their church, retirement savings, college savings for children, etc… So, to do this you take your paycheck of say $1000 and right off the top you put the money to your main priorities. Rather than having 10-20 different budgeting categories of items to be budgeted for you, only focus on the 1-3 most important ones and let the rest of the chips fall where they will. Money must go to the budget categories as soon you get paid.You can’t spend more than you earn – carrying a balance on a credit card is not allowed.There are 2 simple rules to do a simple budget: We will first discuss the less effective, but easier method for budgeting… The world’s easiest budget Now that you have calculated what your monthly income and expenses are, we can start designing our budget. Once that is accomplished, we can work on eliminating wasteful spending or cut other costs to bring the expenses below the income. The goal here is to get your expenses and income to AT LEAST be equal. Just like pruning a bush – cutting back hurts, but ultimately you are going to yield so much MORE fruit because of it!! I know, I know – this is the part that hurts. If you have no idea where to start you can check out these money saving tips. So, if your income is $1000 and your expenses are $1200, that means you spend an extra $200 each month that YOU DON’T HAVE!! What your job is now is to find out what you can get rid of or quit buying each month to save that $200. The problem is that it isn’t good company! Most of our debt-ridden society is in the same boat, but you are one of the bold ones who is jumping out of the debt boat!! Regardless of how your expenses and income compare right now – get excited, because you can easily change it!! If it is bad, you can make it so much better!! If it is good, you can still make it even better!! I will show you how later, but for now… How to make a budget!ĭid you calculate what your monthly expenses and income were? Were your expenses less than your income? If so, you are a rare breed who is in great shape, so just sit tight for a minute.įor everyone else, whose expenses exceeded your income – you are not alone.
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