Budgeting basic may be defined as follows. Ever heard the expression, “I don’t know where my money goes” another is, I don’t have the things I need and can’t afford any of the things I want”. If this is a problem you have, you may want to look at your budgeting basic skills, and read this budgeting advice, paying close attention to the process of creating your optimal budget, and then sticking to it.
1. Start With the Essentials
Your budgeting basic should include your essentials to start with. You must have a home, food, and water, at a minimum to exist. So, those are the things you should budget for and pay for, first.
A) Rent, Food, Utilities, Car Payment (if you must have a car for work)
If you don’t pay for insurance your car can be impounded and your home would not be replaced if it is destroyed by fire. So of course, insurance is an essential budgeting basic. You could lose your credit rating if you don’t have car insurance and an accident is your fault. The other person’s insurance company can charge you with the payout and lien your credit. In most, if not all states liability car insurance is the law.
B) Homeowners insurance, or Renters insurance, and Car insurance
If you become ill, could lose your home and assets to a hospital lien? Possibly. To prevent this, you must have health insurance always as a budgeting basic. If you do not have health insurance, in most cases a hospital will treat you and charge the bill to you, with collection calls to pay up, until you satisfy your bill.
C) Health Insurance
If you have loved ones, that is children or a spouse who will need help with bill paying and life maintenance in the event of an untimely death, you should have life insurance, it can be an inexpensive policy, but it is wise to have something.
D) Life Insurance is a budgeting basic
2. Make Your Hierarchy
Make a hierarchy of your most important to least important needs. Make a list of the most important to the least important budgeting basic items you pay monthly. Try to pay the top 3-6 items, no matter what, even in the event of a financial emergency, and the bottom 3 that can be temporarily eliminated in a dire emergency.
3. Your Savings Please
You will have unexpected expenses from time to time, so an emergency savings may cover those expenses, it will also be your cushion for your top three monthly expenses. Make this savings account a bill that is taken from your checking account or your check monthly so you don’t have to stress paying saving it. Even if it is only $50 per month, start saving now, it adds up. If you can afford more, put in more.
4. Filling in Gaps
Fill in gaps for your quarterly, semi-annual, and yearly items. Some of your expenses will be quarterly, some may be twice yearly, and others once a year. Create savings for these items, pull the money out monthly to fund these irregular accounts when they come due. When the item comes up, take the money from this account, instead of from your monthly pay- check.
5. Maintenance Savings Budget
A second emergency account should be for general maintenance. This is a big item that throws off many budgets. Instead of borrowing money for a car or home repair, borrow it from your maintenance savings budget. This saving account could also include your vacation savings.
6. Your Peace of mind
Every time you think of going off your budget, think about the peace of mind you will get from having a balanced budget, paying your major bills with ease every month, and having extra to cover unforeseen expenses. Your strict organization is the key to a great budget, this is a general organizational plan. You will create a specific plan for your budget, allow this plan to be your guide.
7. Get Help With Your Budget, Don’t do it Blindly
Pick up your free personal finance gifts now, track your spending and plug holes in your budget for extra money toward expenses or savings. Use the simple but powerful, Budget Plan to guerrilla plan your budget with an extreme organization now.
Lois Center-Shabazz | Course Delta Agency
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