First Post

Well, for starters, I know nearly all the applications of good budgeting. I was a born budgeteer, that's right, budgeteer, make it part of your vocabulary. I watched my mother struggle to raise us, all the while out-right refusing to write out a budget, and leaving coupons I cut out for her on the kitchen table. So naturally, that was the one of the first things I set out to do once I moved out.

Also, that fact that I was good with numbers helped a great deal. Even as a kid, I liked counting money, even if it wasn't mine. It seems to me, for many people, the reason or excuse for not budgeting is because they hate math. Why even associate your hard-earned cash with bad experiences in school? --Especially in today's economy, when a small mistake could mean the difference between having just enough money in your bank account to tide you over, or owing the bank, let's say $150 and counting until you can off-set it?

I've over drafted before, and the experience was a lot less enjoyable than a picnic. So where do you begin? Well, first, being fearful of owing the bank could be a great motivator over the fear of numbers. Second, there are those out there that always seem to earn more than their bills and usual expenses, but still fall short. So, I'll start there.

Budgeting, in general is easier than it seems. If you are lucky enough to make more than the total of your bills and usual expenses, but still fall short, this first blog is especially for you. This may be common sense to many, but still for some, there may be a click that just wasn't there before.


1. Add up all your monthly bills that are the same every month; car payments, housing etc.


2. Then the bills which tend to change month to month, use the highest amount, that you can recall over the last year, or if you happen to save everything, go find it now. Or you can always use the average between the highest and lowest. Also, don't forget to include average grocery bills, fuel( which you may have to raise each month ) and the like.


3. Subtract everything from your net earnings, now what do you have left? The next step is very important, and that is where most people mess up.


4. Let's say you started off with $3000 after taxes, and after the bills you're left with $600, what do you do? The answer is NOT to run out and spend it, at least not all of it. Put half that into a savings account. 10% is what you want to shoot for, if you can do more, more power to you. Sure, there's a $700 outfit and shoes or suit that you've been eyeballing for a week, but really, once you've worn it a few times, the novelty is sure to wear off. You'll thank me later.


5. The half that goes into your pocket, divide it among the weeks in the month as your weekly or biweekly stipend.


6. But here's the trick, when you actually write out or key out your budget, every week, the amount you set out for yourself should be listed first. That way, you're paying yourself first, even capitalize for your ego. Also, try to make your budget out over 3 or more months, that way, you get a real idea of where you are. And please, please, please, if you over-spend somewhere, just take that out of your stipend. Why pay the electric company EXTRA money when you don't have to?


Week of Apr 25
Ex: Balance $ 55
Check +1500
1555
Me - 75
1480
rent - 700
780
groc - 75
705
gas - 75
630


So that was kind of a crappy example, but you get the point. I noticed it's easier to do if you start your budget according to payday, or a day or two after rather than say Sunday or Monday. Also, if at the end of the month there is more left over, take only half, and put the other half into your savings account. That way, you're really paying yourself instead of the drive-thru or nail shop. Then, once your account holds enough to earn interest, get it changed over or into something that will make your money work for you. I don't know much about the stock market, and currently, I personally wouldn't take my chances. But there are interest bearing savings accounts, Money Market Accounts ( checking accounts that bear interest ) and CD's ( certificates of deposit ), it's not much, but free money is free money.

And whatever you do, leave it be, the more money you have staved away, the better, a penny saved is truly a penny earned. Most people who touch their savings accounts never put it back, and for everyday that money is not there, you are losing interest on it. Also, this can be a life -saver should something unexpected happen, such as car trouble or the washing machine gives out on you. I know there are many people out there that don't have these options and don't have enough to cover the bills. I will get to that, I'm just covering the above since I was in a similar financial situation, and fluffed it up.

My only excuse is that I was young, and knew no one who could guide me in the right direction. I had money, while everyone else around me made me into their personal bank. --And not that it was a lot either. I was living 'above' my financial means in a sense only because I knew how to finagle and pinch pennies where needed. I lived middle class, but I was actually just below the poverty line, didn't even have a credit card at the time.

Just so you know, and understand where I was so you don't make the same mistakes and take a dive because you think you have it all together. I was hanging by a thread that broke.


To be continued...