Getting to grips with budgets.

Now this is not about food or coking but more about what we do with our money and how we spend it. Get control of this and you will get control of your life. And as long as you do not have everything spiralling away from you then you should get to grips with what you have to do day by day and week by week,

A budget is the perfect way to take control of any finical situation. It is a tool that you can use to find out what you have going out what you have coming in. You can set targets for spending and see what you can reduce and what you can spend more on. With a budget you will see easily what you need to do to take control of your money and in turn get control of your life. That might sound dramatic but if you budget then you could reduce your debts and get back finical freedom. And with freedom comes the choice to make the decisions that you want to take, not have to take.

So what do you do to start with? Most of the time people get so bogged down in the how much did I spend and let’s spend next to nothing. Then the next thing you know you have set a budget so tight that you cannot keep to it and you give up with the whole idea. All you need to remember is that a budget is a finical tool to help you get control of the money that you are in charge of. It will not make you rich and it will not save you money, only you can do that.

So to start with you must work out what you have to spend every finical period. Now that might sound very difficult but all I mean is find out what you have going out very month week or if you like every day. The choice is yours, when you get paid is normally best time to start as you know what you have coming in. And as most bills are once a month so work out what you need.

Make a list like this

Rent        300
Food           150
Petrol         120
Heating         35
Electric       45
Miscellaneous  78
Total          728

Now you know what you have going out hen take what you have coming in and see what you have left.

    Total out      728

    Total in       850
    Spare         122

And there you have it your very basic budget pan. How do you know that you will spend this well for me you start with what you think you will spend. Say petrol, you spend you think 30 a week on petrol, four weeks to a month on averaged gives you 120. Now some weeks you will only spend 20 some 25 and some 35 but if you try and work to an average then you will have a target that you can work to. So if you find that after about four months that you spend less money than you thought on petrol and actually spend 115 a month that means you have 127 spare.

Now you know what you have going out then you can plan to get rid of what you owe. Say that you had 1000 debt to pay off. If you took all the spare money and put that to pay it off then you would be debt free in eight months. But if you wanted you could split is and pay off some of the debt and build up some of it in savings. Then if you build up some capital behind you might not have to go in to debt next time you need to buy something.

It might all sound very complicated but if you have Internet banking you can easily get all the information that you require easily and just put it all on a spared sheet. Or if you do not feel that confident just work it all out in a book.

A budget is a finical plan and if you make one it is a statement of your intent. And like all plans it might go wrong at the start. But do not worry because if you are determined you will end up with something that will work and you will gain the control of you many that you want.