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How to create your own Budget

When you sit down to work on a financial plan for you and your family, it is important to create a realistic monthly budget that encompasses everything you and your family need. This budget should include putting away money in a savings account to take care of incidentals or household repairs. Many people have no idea where to start, however, when it comes to creating a budget. Here we will give you a few tips to help you get started, and then walk you step by step through creating your own family budget.

Budget creating tips

Every budget needs a place to start and you need to remember a few things while you are working on it. Whatever you do, try not to get frustrated because creating a budget is not nearly as hard as it seems. See if the following tips help you out.
  • Sit down and make a category for every budget expenditure you are liable to have. Be specific about naming the category. For instance, if you enjoy taking the family out to eat once a week, create a category called ‘dinner out’ or ‘restaurant meals’ instead of putting them in with your food category.

  • Keep your budget simple and only include expense categories for things that happen enough through the month to warrant their own category. All of your essential debt should have their own category as well as major non-essential debt such as loans.

  • Tailor your categories to meet your needs by starting out with a generic budget worksheet and customising it.

  • Remember as you work on your budget that this is a tool and not a punishment. It is designed to help you save some money and get out of debt.

Creating the budget
  1. Start with a blank financial budget worksheet that you have loaded onto your computer or a paper copy that you picked up at the local stationery store. Since most people work on computers, we are going to gear these directions towards computer users, but the entries on the budget work the same on paper.

  2. Gather up all of your bills, receipts, and cheques for the past two to three months and assign each expense a category. Feel free to create categories as needed.

  3. Review your pay slips for the last few months to determine your average monthly gross pay.

  4. Using your historical information, assign each category on your spreadsheet a realistic budget amount for the month. This number should be reasonable because you are basing it on historical precedence. Make sure you also include all income sources available such as child support, second jobs, and other income.

  5. Set a spending target for each category. The ideal target number should be lower than what you are actually spending, but not unreachable.

  6. Track all of your cash expenditures on your budget sheet to see how close you are coming to meeting your goal.

  7. Make adjustments to your budget as needed until you bring your spending to the balanced level you have been trying to obtain.

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