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Budgets

 

            A budget is a way of gaining control of, planning, communicating and fulfilling your dreams. At the very least, a budget should allow you to find extra spending money in your paycheck every month. It can help you see how to use money to pay bills and get more of the things that you need and want. A budget allows you to decide what is important to your family and to make choices before spending your money. The benefits of a budget are that it can help you live within your income, place your needs above your wants, set aside money for large planned expenses, emergencies, and save for the things you want.
             To create the family budget, you need to review your family goals. If you do not have a list of goals, then you will need to create one. You need to decide what your short-term needs (i.e. down payment for car, insurance, shopping spree) and long-term needs (i.e. retirement, vacation) will be and then prioritize them. The income part is easy -- take a look at your most recent pay stub and copy your information. Most budgets use your "disposable" income, which is income after taxes. You will also need to include any other income such as rent, alimony, child support, etc. After you have gathered your family's goals and income, you need to set up your spending and savings plan. You will need to gather your expenses, such as food, apparel, health care, education, insurance, 401K contributions, rent/mortgage, transportation costs, entertainment, charity and any other miscellaneous expense you incur. Break your expenses down into categories; fixed, flexible, periodic and emergency. Fixed expenses are expenses that stay about the same. They include such things as house payments, insurance, time payments and charge accounts. You need to document the expense, the date it is due and the amount due. Flexible expenses vary from week to week. These include food, clothing, utilities, gasoline, savings, and medical care.


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