Before I started budgeting, I got used to asking myself "Where does all my paycheck go?" I would get nervous a few days before payday because I hadn't planned on getting through the whole 14 days until the next paycheck. That is where I was with a budget for the pretty much my entire adult working life. I had never kept up with what I was spending. I lived my days assuming that what I got paid every two weeks would get me through. Well, you know what they say about assuming...
Of course, a few years down the road when it all caught up with me, I did in fact look like a fool. I was at the point where I didn't know how I was going to pay my rent that month. I had no savings, no emergency fund, and no real budget plan to pay my monthly bills. It was time to get organized and informed. Not only did I need to get a budget started, but I needed to know what I was spending my money on during the month. I was the only one who cared about my own personal financial security, after all, and it was my responsibility. I was ready to make the change.
When I decided to finally stop throwing caution to the wind and put my foot down on my monthly financial planning, I was stumped on where to start. After some research, I found everything from simple to complicated ways to get my budgeting started.
There are 3 types of budgets you can get started with:
- Write it out. Maybe the simplest way that I have found to establish a budget is to just write it out. Take any ole plain notebook and list your monthly income and your monthly expenses. When you first get started, try just writing out 1 month or 2 weeks at a time. The only real drawback for me is that I tend to write in pen, so if anything changes, I can't easily rewrite. I keep my budget folder with me at all times.
- Use a budgeting program. As a backup, I downloaded some budgeting software for added culpability. I only keep my necessary monthly expenses on my written budget like utilities, monthly housing income, and automatic drafts. Here are some programs to get a good start with:
- Mint.com. This program is accessible from all types of electronic devices and is a free download. It can keep track of your bank accounts as well as any other accounts you sign up such as credit card and investment accounts. My income is on the lower side so it was a bit too technical for the amount of money that I am budgeting every month. Mint
- EEBA. Easy Envelope Budget Aid is also a program accessible from all electronic devices and a free download. You can use envelopes to track precise budgeting areas such as groceries, savings funds, and fun money. For a small fee it can track your online accounts in real time. EEBA
- Pear Budget . Although this is not a free program, they do offer a free 30-day trial. If you are a beginner in budgets, this would be a good program to look into. They offer a set-up wizard and the basic envelopes system. Pear Budget
There are an infinite amount of budgeting programs on the internet and available to download to your cell phone. The key is to finding what works for you. You have to want to make a change and be motivated enough to keep up with a budget. Keeping it as simple as possible is the easiest way to start a budget and not getting frustrated is the best way to stay on track. When starting out, programs like Quicken and Microsoft Money can easily be a deterrent.
My budgets are pretty simple. I write my monthly income and subtract all my monthly required bills such as child care, automatic savings draft, and my storage bill. I then go to my EEBA android app on my phone and add money to my envelopes for the 2 week periods between each pay period. Simple as can be for me. I have read many books and blogs that say you don't really need to check your budget but once a month. I watch my budget usually everyday, just to make sure I stay motivated.
How do you make you personal budget?
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