The Budgeting Process

1. What it is:

·        A plan for spending and saving

2. What it takes:

·        Choosing a budgeting period

·        Estimating expenses and income

·        Balancing expenses and income

3. What a budget does for you:

·        Puts you in control

·        Helps you create a visual spending picture

·        Helps you prevent impulse spending

·        Helps you decide what you can and cannot afford

·        Enables you to keep track of how you spend your money

·        Helps you create a savings plan

·        Helps you decide how you can protect yourself against the financial consequences of unforeseen events

Setting Up And Maintaining A Budget

1.       Estimate your income.

2.       Estimate your expenses to include:

·        Fixed regular monthly expenses

·        Fixed irregular monthly expenses

·        Flexible monthly expenses

·        "Mad money"

3.      Estimate your future expenses.

·        Begin by keeping a record of everything you spend.

·        What are your financial goals and your plans for obtaining those goals?

4.     Cope with change.

·        Plan for new situations.

·        Plan for changing conditions that increase or decrease your expenses.

5.     Keep your personal and financial goals in mind.

·        Set money aside to help meet financial goals.

6.     Balance your budget.

·        Each month, compare your income to your expenses. Continue reworking your budget until your income is greater than your expenses.

·        Discuss different budget options available.

7.     Practice setting up a personal budget.

Tips For Maintaining A Budget

1.      Become a good consumer.

·        Learn how to get the most for your money.

2.      Exercise will-power and self-control.

·        Try to not indulge in unnecessary spending.

3.      Develop a good record-keeping system.

·        Learn how to maintain a workable budget.

4.      Evaluate your budget regularly.