The whole purpose of creating your budget is to get control over your finances. Use this worksheet for headstart in tracking your income and expenses: Any method will work, but make sure to choose one that is easiest for you to use and to track. You can do this using spreadsheets, paper and pen or even one of many apps available. The last 20% should go to savings or debt reduction.Ĭhoose the plan that best fits your goals and then create your budget. The next 30% goes towards wants such as travel, restaurant meals or hobbies. 50/30/20 Plan: A 50/30/20 plan allocates 50% of your income to expenses that are considered needs such as rent, utilities, groceries or gas.With this system, you allocate specific amounts of cash to different envelopes and once the money is gone, you can’t spend any more cash in that category. Envelope System: The envelope system works best with cash.The goal at the end of each budget cycle is to have a zero balance. Zero Budget: A zero budget will allocate every penny of your income to a specific category such as expenses, debt pay down and savings.There are several options such as a zero-budget, envelope system, or the 50/30/20 plan. Now that you have an idea of your income and expenses, you’ll need to decide what type of budget you’re looking for. It’s easy to forget those small purchases, but they do add up. Take a look at your last few bank statements to see where you may be spending. You’ll also need to be honest - the indulgent spending that inevitably creeps into our daily lives such as a coffee run or a lunch out with friends needs to be accounted for here as well. While your regular monthly expenses such as rent/mortgage, car payments and insurance should be easy to calculate, you’ll need to include averages for things like haircuts, clothing, vacations and other expenses. Here you’ll want to record everything that you spend money on. This may be most difficult part, as you’ll need to gather quite a bit of data. If you have other income such as child support, alimony payments or rental income, include this here, too. ![]() This amount should be your monthly take-home pay after taxes and other deductions. Putting a budget together takes some work, but once it’s done, you’ll find it's easy to maintain and to adjust when needed. Taking a deep look at your finances can be intimidating, but it’s important to do especially if you are looking forward to buying a home, retiring or making another large purchase. One of the best decisions you can make for your financial future is to create and then stick to a budget.
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