Okay, we know the stats out there aren’t pretty when it comes to budgeting. We know there is a lot of debt and credit cards in circulation, combined with a lot of poor planning and a lack of saving. We know that marriages are ending over the issue of money; yet even though there is so much “information” out there on these topics, we seem to continue on the same course with our spending and saving habits.
You’ve probably heard this one:”If you keep doing what you’ve been doing, you’re going to keep getting what you’ve been getting.” I don’t think money management is meant to be rocket science; in fact, I think it’s pretty simple. Just because I said it’s simple, doesn’t mean it’s easy.
You have to ask yourself this question: “If I was out of debt or got my spending under control, how would this change my life?” If it would change your life so much to be out of debt, why are you over-spending? Why are you in debt? Are you worried your kids aren’t going to like you if you don’t buy them what they want? Are you trying to keep up with your neighbours? Did you grow up poor and vow never to live like that again? Do you want to get out of debt and get your spending under control?
If you answered “yes” to the above questions, then keep reading.
One thing I have learned is that there is no magic formula for anyone. Everyone has a different personality and different ways of doing things so you need to find out ways that work for you.
The thing we all have in common is we all need to spend less than we make. Personally, I have a budget sheet that I actually follow every month (I have done this for 14 years). I realize some people find this obsession of mine with a budget sheet a bit strange and that’s fine. I am asking you to at least do it once. Write out your budget. Figure out where you are spending your money.
So, this next month, here’s what I want you to do:
Keep all your receipts (you can record your receipts on a piece of paper, on a computer or keep your receipts in a shoe box).
At the end of the month, categorize your receipts into categories – food, entertainment, clothing, etc.
Wright out all your debt on a separate piece of paper. Write down the monthly payments you are making on each of these debts. Add up those monthly payments and add that number to your budget sheet. For example, if you are paying $500 a month to debt than add $500 to your budget sheet under expenses. The goal will be to pay off this debt as soon as possible.
Now you’ll probably need to figure out where you can decrease some spending. Chances are you’re spending more than you’re making. So, get creative. What can you cut out of your budget? Can you sell something? Can you reduce a bill?
If you need a budget template, join my blog at www.budgetobsessed.blogspot.com and let’s journey on this budgeting road together.