Want to Make a Personal Budget? Follow These Tips

Making a budget and sticking to it has many benefits. You can understand your income and spending, make necessary adjustments, and plan for the future. Don't know where to begin? Here are some tips to get you started.

  • Be honest about your income. Make an accurate and precise estimate of the money coming into your household. Base it on your net, or take-home, pay!
  • Understand your spending. Attempt to account for every single penny, including housing, utilities, food, gas, and other expenses. Use bank statements from the previous six months to get you started.
  • Find wiggle room. Once you can compare your income and expenses, you'll know how much disposable income you have. Cutting costs or increasing income will help you change that number.
  • Don't sweat unexpected expenses; plan for them. Family emergencies and medical crises happen. To keep them from breaking your budget, rework it and create a plan for getting back on track. An emergency fund kept in a savings account can help you deal with unexpected problems.