The idea of creating a budget may seem a bit intimidating at first. Whether you are looking to save up, pay off debt or just get your finances in order, a budget plan is the way to go.
There is defiantly some work that goes into it. But at the end of the day it will all be worth it. If you are ready to set a budget plan, you have come to the right place! Grab yourself a notebook and a writing utensil and keep reading.
Why do you need a budget?
To achieve your financial goals, duh! But for real though, you need a budget to hold yourself accountable. If you don’t have a clear budget laid out, chances are you’ll just blow your money. And the more money we blow, the further we get from our goals.
You need a budget plan to discipline yourself. And self discipline is a good thing, a great thing. Your finances are very important. Just like how you learn to discipline yourself to get the physique you want, you need that same discipline to achieve your financial goals.
Creating the monthly budget plan
I’m going to take you step by step on how I created my fool proof budget plan. I made myself some kick ass templates to really get my finances in order.
If you want these templates CLICK HERE.
1. Get yourself some budget plan “tools”
Set yourself up for success, always. If you don’t have my templates, that’s just fine. But I highly recommend you get a notebook, a binder, sticky notes, a really nice pen. What ever will make you want to go back and look at your budget plan again and again.
2. Gather financial paperwork (Or webpages)
Time to get down to the nitty gritty. Grab your paystubs, your car bill, hospital bills, just get your bills. I know a lot of us are paperless now (which is awesome). If thats the case just open up your phone or laptop. OH! And grab your recent receipts too if you have them.
3. Write down all of your income
The first part to creating your budget is to determine how much income you have every month. If you have just one income stream that’s fine. But if you have more than one, make sure. My income changes a bit month to month. So, I always low ball my monthly income. I’d hate to estimate to high and not have enough to cover everything. And with keeping my estimate low, it helps me save a little extra.
4. Write down all of your expenses
Start by just covering your fixed monthly bills. Those are the things like
- rent or mortgage
- heat or AC
- car payment
- health and car insurance
- student loans
*If you don’t have an emergency fund, its a good idea to start one*
Then move on to writing down the variable expenses. These are the things like
- eating out
- going to the movies
- spa days
Be sure to spend some extra time figuring out where your extra money is going
If you want to create a great budget plan, you absolutely must be brutally honest with yourself. You spend too much money on random shit from Amazon? That’s ok. We all do. We all blow money here and there. Some times its more than we would like to spend and that’s why we make budgets.
To control the spending, you have to be completely honest with yourself. And of course, set aside some “fun” money for you in your budget but you have to stick to it.
Set some financial goals
Why are you creating a budget plan?
Maybe you’re looking to pay off debts. Perhaps you are looking to save up for a vacation. You could be working towards buying a new how or car. Or maybe you are just sick of the paycheck to paycheck life style. What ever you’re goals are, make sure you write them down. Write them all down. And when you reach one, set a new one.
Set some goals, and keep reaching.
Now, you have all of your cards on the table. You have all of you’re spending and your goals laid out in front of you. The next step is to adjust your spending. Find where you can cut back. Look for things you can cut out. And start doing those things.
So in conclusion, to set up a budget plan, you need to:
- Get yourself some budgeting tools. A binder, pens, pencils, highlighters, etc
- Gather financial paperwork
- Write down all income
- Write out ALL expenses
- Spend some extra time to figure out where the extra money is going
- Set some goals
- Adjust spending
- Achieve your financial goals.
You can do this!
I hope you find this article helpful and informative. Leave me a comment below and tell me what helps you stick to your budget.