A budget is simply a record of all incoming and outgoing money during a specific period of time. Many families/individuals create personal budgets to track their monthly income and expenses. Contrary to popular belief, a budget doesn’t limit you financially. Instead, it gives you financial peace and freedom. Here’s 4 steps for creating your first budget.
1. Figure Out Your Total Monthly Income
How much money are you bringing in every month? If you’re making a family budget, make sure to include both you and your significant others’ incomes. Consider any additional, variable income like parttime jobs, bonuses, etc. If your income changes every month, base your budget off of the lowest amount you’ve brought in on any given month. This ensures you won’t go “over budget”.
2. Make a List of All Outgoing Money
First things first … list out all of your regular monthly bills like rent, car insurance, health insurance, cell phone, cable, etc. This list should include any set expense that you have every single month. Then, make a list of all of your variable monthly expenses such as groceries, electricity, clothes, gas, etc. This list should include any other expense you expect to have that month whose value changes month to month. For instance, in August, you may need to budget additional money for back to school clothes for the kids. However, in October, you may not have a need for new clothes.
3. Balance Your Budget
Add up all of your income to get a total income for the month. Next, add up all of your expenses to get an outgoing expenses total for the month. Your outgoing expenses should be less than or equal to your total monthly income. You can’t spend more money than is coming in!
If your expenses are greater than your income, it’s time to make some changes. Perhaps you need to adjust your expenses and find ways to spend less money. If that’s not possible, you need to consider other income opportunities. Are you up for a promotion at work? Could you ask for a raise? Maybe you need to take on some additional parttime
4. Use the Budget!!
Creating a budget does nothing for your financial peace and stability if you don’t actually use it! Stick to your budget. Don’t overspend. Creating a budget can help you gain control of your finances, get out of debt, and save money for important purchases.
At Real PDL Help, we work one on one with our clients to help them get out of payday loan debt and regain control of their life (and finances). We work with our clients to develop a budget based on their specific income that helps them get out of payday loan debt and get back on track. If you’re struggling with payday loan debt, contact us today !