How do you know how much money you have available to spend right now?

If you check your bank account online or run to an ATM, you’re missing some important points. Specifically, you’re not taking into account which bills are due soon – which can cause you to overspend.

Here’s how to really know how much you have – by learning how to prepare a budget.

How to Prepare a Budget

First, make a list of your income and the dates you will receive it. It may be easiest to create an every-two-week budget if you’re paid twice a month, for instance.

Secondly, list all of your bills and expenses, along with when they are due. Include everything from your rent or mortgage to car payments to insurance. Don’t forget gasoline for the car, groceries, and other important expenses!

You also want to budget some money for savings. If your retirement investments are automatically deducted from your check, great! But you may want to save up for other financial goals as well.

Compare your income to your bills. That will help you know where you stand.

You may find that a lot of your bills occur in the first half of the month, and few in the second half. Moving due dates may help even things out and help you get everything paid on time.

How to Stick to a Budget

Now you know how to prepare a budget. But this is the million dollar question – how do I stick to my budget?

One of the best ways is to give yourself a specific amount of “fun money” each week. This way you don’t feel deprived but you also don’t spend every extra dollar.

You may want to contact your providers, from internet to your cell phone company, and ask them for lower rates. You’ll be surprised what you can get just by asking!

It’s also important to have an emergency fund so that a single large expense does not wipe you out. This includes things like medical bills or car repairs. A lot of folks suggest having $1000 set aside for these emergencies.

You can also find ways to earn more money. Working a little bit of freelance on the side of your main job is a good option, and may even turn into your own business! You may also choose to take a second part-time job or find ways to make money from your favorite hobbies.

Set and Reach Your Financial Goals Today!

Setting a budget and sticking to is just the beginning of your financial success journey. Day to day, your budget will keep you on track. However, you probably have bigger goals for your future.

Let us help you with the savings and investment plans you need. Contact us for a consultation today!