Today’s challenge is not really how to get money, but spending it wisely. This is where a household budget becomes necessary. Ideally, a budget is a written plan that helps you plan your expenses and show you where your money is going and coming from.
A budget is important because it helps us ensure that we are not spending more than we earn. It also helps in that small important things are listed and hence easy to remember. In addition to this, it also helps us see if there is a possibility of cutting some costs which may otherwise not be necessary.
The first step would be for you to find and list all your source(s) of income. By doing this one will be in a position to see how much he gets in totality. Next, put together all your expenses that have to go out. Here, you will include things such as, utility bills for instance, water, gas electricity, phone and internet cable. Food and personal expenses should also be included in this list.
Subtract expenses from the income and see what you get. If you get a positive number, then you are good to go. Mind you, the main aim is for the expenses to be less than the income. Therefore if you are unlucky and the expenses you incur are more than what you bring in, then you actually need to go and recheck your expenses and cut down on where possible.
Studies reveal that only 90% of people succeed to make budgets and stick to them. Are you among this group?
Setting up a household budget requires time and most of all, discipline. It might take most of your time to make one, but definitely it is worth the pain as it helps avoid overspending and debts.
Finally, budgeting is the best way to make money!