How to Make a Budget – Family Budgeting How To

How to Make a Budget – Family Budgeting 101

make a budgetIt is more important than ever to learn how to make a budget and stick to it.  If you live alone or have a large family to raise, chances are that people are expecting you to stretch a dollar as far as it can possibly go in these challenging economic times. Learning to live within your means is one of the most important ways of staying financially solvent. When you make a budget it will help you determine what money you spend where, so that your spending doesn’t control you.  You need to control your spending and do that you need to make a budget.

How to Make a Budget

There are few simple steps you can take that will make a light turn on for you as far as where your money goes:

·      For one week, keep a notebook and write down every single thing you spend money on –  whether it is paying a bill like a mortgage or car payment to buying a café latte at your local coffee shop.  Write it down and at the end of the week, categorize your spending like this, (1) wants, (2) needs, (3) unexpected expenses. This will help you later when you go to make a budget.

·      The next thing to do is not cut out the (1) wants category completely, but see if you can reduce the number of things you spend money on.  For instance, taking a bagged lunch to work just one day a week instead of eating out can add up to savings of $40 a month, which translates to $480 a year.  If you consider all the little ways your pennies add up, and make small changes, you’ll find you can achieve a similar lifestyle with very little sacrifice and a whole lot of savings. Won’t take long to make a budget now.

·      See if you can spend less on things you must purchase, like groceries and gas, by taking advantage of sales and store coupons. Buy in bulk if you know your family uses a lot of something. There is no need to spend $1.00 per roll on toilet paper if you can purchase it on sale, or in bulk and pay 30 cents per roll. Again, small savings add up to big savings. But when you make a budget – don’t buy things just because they’re a good deal.

·      Trade one expensive hobby for a cheap or free one each month.  If you love to read, try going to your local library instead of the bookstore.  If you love to golf, find a course that has free or dirt cheap green fees, instead of playing at a country club.

·      To make a s budget work, stop buying things with credit cards. The only way of changing the way you see money is to spend what you have, not what you expect to have. If you can’t afford to pay cash for it, that means you can’t afford it – yet.  Try saving up for things instead of buying on impulse and using credit. You’ll feel a greater sense of accomplishment skipping a few high dollar dinners to buy that great sofa you saw at your favorite boutique.

·      Studies have proven that people gain more happiness from experiences than things.  Spend time with friends.  Learn a new language. Plant some new seeds on your patio garden.  These things are all practically free and add to your sense of self worth without breaking the bank.

Make a Budget – Work it For You

When you make a budget you need to make it work it for you.