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Feb 142013
 February 14, 2013  Posted by  Budgeting and Organization, Hot Deals, Money
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For many of us, the idea of living on a budget conjures up ideas of being strapped in, chained down and forced to give up on things we want. But managing your money can give you a sense of security, set you free from worry and guilt and help you meet important goals. You don’t have to spend a lot of time or get too tedious. Just get started. Here’s a very simple budget plan you can quickly complete to begin better money management today.

Where does your money go? Today’s electronic society can distance you from reality. Even if you have recurring payments like your health insurance and utility bills automatically withdrawn, sit down and list all your monthly expenses so you have a full grasp of what’s going out. Include credit card payments, personal, student and auto loans, as well as how much you figure you spend on entertainment. Then list any quarterly expenses such as life or car insurance. Finally, annual payments such as real estate taxes get listed. Divide your total quarterly and annual expenses these into twelve months, and add them to your monthly expenses. You’ll also need to add in expenses such as food and car fuel. If you shop or fill up weekly, multiply the average money spent by 4.3 for a monthly figure. Add everything up to get your total. If you want to make this even easier, use the search term “budget worksheet” for a slew of links to fill-in forms to create an easy budget.

How much comes in? Now list all your monthly income sources and add those up. If you have quarterly or yearly income such as inheritance payments, do your best to divide those into monthly figures you can add into your total figure.

What’s the difference? It may seem counterintuitive to list expenses before income since you’ll subtract the first figure from the second, but getting a clear understanding of your expenses first can be a motivating wake-up call, which is why it’s the first step here. If the difference between income and expenses is a negative figure, you need to cut expenses or find a way to bring in more income. Even if you’re in the black, scrutinize your expenses for ways to save money and shrink your outlay of cash. Consider making a simple pie graph for a clear view of how large a slice each expense takes, then you’re prepared to make changes to expenses over which you have control.

What’s ahead? With a solid grasp of how much money goes out compared to how much comes in, you can make plans to save for your future and set goals for big-ticket items such as a down payment on a house or a dream vacation. You can also decide, wisely, how much you’re willing to spend on entertainment extras such as dining out.

Now that you have created a very simple budget, you can scrutinize your expenses for more ways to save, and get set for long-term money success.

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Sheri McGregor

Sheri McGregor is grateful for the freedom of expression she enjoys as a writer. Lately, she's settled into writing about what most interests her: psychology, business, people, and nature for nonprofits, magazines, and at her joyful living and homesteading blog: Balance and Joy. As a native San Diegan, she also publishes San Diego Hikes, the subject of her three latest books, 60 Hikes Within 60 Miles: San Diego, Day & Overnight Hikes: Anza Borrego Desert State Park, and Easy Hikes Close to Home: San Diego. As a mother of five, Sheri learned from necessity how to live well for less, and calls this smart lifestyle "the new swank."

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