Being a responsible adult is not a walk in the park. There are a lot of “adult” obligations and responsibilities that I never thought existed when I was a kid, like the need for a job, paying taxes and bills and such. And things got even more challenging when I became a parent.
Of course, my kids are my life and soul and I love them more than I love myself. But I honestly felt more financially challenged as my family grew. And so, I therefore decided to try out a simple budgeting strategy a friend of mine suggested. I never thought I could actually pull it off. In the beginning, it was a bit tough. Adjustments were necessary, but cutting back on the least important things really made a big difference.
Here’s how to make a budget for just about anything. I truly hope it would help you as it did me and my family. Read on.
First and foremost, determine your goal. Perhaps you wish to save up for your kids’ educational plan, or for a family holiday trip, or simply for a surprise birthday bash for your dad next month. Whatever your goal might be, setting a practical timeline for it makes it more obtainable. On the contrary, the lack of a definite goal also equals a lack in motivation. With a clear goal, you are more motivated to strictly follow your budget plan.
Study and Evaluate
Compute your monthly income, after taxes. This should include your take-home salary, plus all money earned from sidelines and other personal investments.
Next, make a detailed list of your monthly expenses. Categorize these expenses into two basic divisions: the basic needs and the not-so-basic wants. Of course, the basic ones should include food, water and electricity, auto, medical, school supplies and savings. The less important ones may include entertainment and leisure, like pizza or ice cream night. To make this easier, make sure to keep record of all receipts.
At the end of each month, compute the subtotal of each category and finally the total of all expenses. Subtract your total monthly expenses from your total monthly income after taxes. Review and decide where to cut back on, more particularly in the ‘wants’ category.
Make the Necessary Adjustments and Stick to the Plan
Need I say more? Whether you choose the old-fashioned ledger technique or opt for a more up-to-date budget-planning software on your phone or computer, you simply need to stick to the plan. Austerities and sacrifices always pay.