Budgeting Basics

So, you want to start a budget but don't know where to begin? Starting and staying on a budget is simple if you identify what your goal is and what your personality is.

First Things First

The first thing you need to do in order to establish a realistic budget is to identify what your purpose is in setting up a budget. Do you want to save and invest more money? Are you trying to find ways to live within your means? Do you want to see where your money is going? Do you want to see how much more money you need to bring in so you can meet all of your expenses? Figuring this out will help you determine what you need to do when you set up your budget to accomplish your goal.

Getting Started

For at least one month you need to save all of your receipts. Yup, every single one of them. Plus, keep a piece of paper or small notebook with you in order to record expenditures for which you receive no receipt, such as at a vending machine. Be sure to record the amount spent and what it was spent on. You can organize them into categories with a small accordion folder; throw them into a jar to sort later; or whatever works for your personality and time limitations. Just be sure to put them all in the same place.

Once the month (or longer) is over, it is time to prepare your budget. You will need a calculator, pen/pencil, and paper or a computer program for budgeting. Now is the time to decide whether you will keep and maintain your budget on your computer or on paper. There is no right or wrong answer here. Just do what you feel comfortable with and can easily maintain.

The Budget