How To Budget Your Personal Budgeting
Cerro Gordo allocates money to fair board — with conditions
MASON CITY — Cerro Gordo County supervisors Tuesday allocated $30,000 to the North Iowa Fair Board for next year, but put some conditions on it.
Read more on The Globe Gazette
Layoffs don’t have to torpedo a career
Bill Kirby, managing partner of human resources firm OI Partners-Russell Montgomery & Associates, learned about corporate cutbacks the hard way.
Read more on The Tennessean
Public to weigh in on school budgets
PORTLAND, Maine (NEWS CENTER) — The budgeting process has been a long haul for school superintendents in Maine.
Read more on WLBZ Bangor
Sheriff’s budget finalized By MAC CORDELL
Making the figures work is still an issue While the commissioners and the sheriff have agreed on numbers for the sheriff’s office budget, Union County Sheriff Rocky Nelson does not know how he is going to meet the budget.
Read more on Marysville Journal-Tribune
One of the most important things to include in any budget is the payment you make toward any debt you have beside your mortgage. This includes credit cards, student loans, and any other personal loans. According to the April 2009 Nilson Report, in 2008 over seventy-eight percent of American households had one or more credit cards. The Nilson Report also states that at the end of 2008, the average American household had an average credit card debt of $8,329.00. In today’s economy these numbers aren’t helping anyone and we as Americans are only sinking deeper and deeper into debt as we are being laid off from our jobs and our savings.
Sometimes its hard to grit your teeth and write the check for your credit card payment, but the best thing you can do for you and your family when creating a budget is to push as much of your income as you can toward paying off your credit cards, especially high interest credit cards. This is definitely an area of your budget that I would encourage you to invest the money you are saving in other areas of your budget. One way you can do this is by figuring how much you are saving in other areas of your budget. Maybe you’ve cut your utility bill in half by switching to energy efficient appliances or you could be saving $100 a week in fuel because you choose to start carpooling to work with a co-worker. No matter where the savings are coming from, after you get a figure, you should take that amount and start putting it in a separate savings account along with the money you use to make your monthly payments on your debt. That way when it comes time to make a payment on that high interest credit card, you can start paying a little extra on it. Even if paying extra on it every month decreases your monthly payment on your statement, you should still keep paying the same amount and you will be amazed at how easily it will be to pay down those credit cards.
You may be wondering where are student loans in all of this? Student loans are a priority, but not as much of a priority as your credit card debt. This is because student loans usually have a reasonable interest rate and they may shoe up on your credit report, but I don’t believe they hurt your credit as much as credit cards do. You should still be actively making payment on your student loans if you have any, because even though the interest may be reasonable, interest is interest and the longer it take you to pay them off, the more you’ll end up paying on them in the end.
This is an important part of any personal budget and should be consider as much of a priority as making your house payment. You will be amazed at not only how much it will help your credit to pay off your personal debt, but also how much stress it will relieve knowing that its being taken care of and you are doing something that won’t just benefit you now, but it will also benefit you in the future.
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Keeping track of our hard earned money is something that a great majority of us have trouble with. It’s as if we spend it faster then we make it and by the end of each pay period we are left wondering where it all went. Learning to efficiently manage money is something everyone needs to know, but unfortunately most people are never taught this most valuable of skills.
This is where a budget is most valuable. It gives a starting point in which we can all learn to properly manage our money. Let’s look at it this way. Most businesses and corporation have a budget, even the United States government has a “budget” (okay, bad example), but individuals and families seldom follow any sort of budget. In this day of overwhelming debt this is not good.
The first thing you need to do when starting a budget is to set a goal. What do you want your money to do for you? Do you want to get the spending under control? Get out of debt? Save up for a big purchase? Put money into retirement accounts? If you have a specific goal or goals it is much easier to build a budget around that.
Most people who start a budget just want to find out where their money is going. As you list out your expenditures you will begin to see patterns. Some expenses you just have to live with like a mortgage or utility bills. It’s when you start looking at all the little expenses and how they add up they don’t seem so little anymore.
If you start cutting out some of these smaller daily expenses, like the daily morning coffee for 4$ a pop, you may begin to see that you do indeed have extra money at the end of the month. The point is that it is the small items that add up over time and this is what causes the most financial problems for many people. If you buy that cup of coffee on the way to work everyday that turns out to be $80 a month or $960 a year. Add a few more small regular purchases into that equation and before you know it you are spending thousands of dollars a year on coffee, sodas and other things.
Here’s another secret to keeping your budget going. If you are using your budget to help pay off credit card and other debt then list out your debts from smallest to largest. Once you pay all your minimums on all your debts take any extra money that is left over and send it to your smallest debt. Yes, that’s right, the smallest one. You’ll be amazed at how quickly you pay that one off and it will give you motivation to move to the next one.
Staying motivated is best way to keep using a budget to find that financial freedom you always wanted. After all, it is our behavior with money that causes most of our financial problems in the first place.
Andrew Bicknell researches and writes on a variety of subjects. To learn more about building a family budget please visit his website Household Budgets by clicking here.