Learn to Budget Money In 4 Easy Steps

Before you can learn to budget money, you need to know what a budget actually is. Dictionary.com defines a budget as an estimate, often itemized, of expected income and expense for a given period in the future.

Basically this is the money you have coming in and the money going out to pay bills such as your mortgage, lights, water, and credit cards. When you learn to budget money, it will be easier to see how much money you have left over. It's amazing how effective a budget can be when you put it on the computer or on a piece of paper.

When you set up a budget, you will have a better understanding of how much money you spend each month, you will know how much you can spend, and where all of your money is going. This will also help you to know which bills need to be paid with each check. You will be able to prevent late fees and finance charges when you set up your budget. Another thing you will be able to do is set up a savings account with money you have left over.

Here are the steps that I use to step up my own budget. Use these four easy steps to learn to budget money for yourself.

• Gather your bills

Gather all your bills for the month. This is a crucial step in you want to learn to budget money and control your spending more effectively. You will need statements so you have the amount you owe, the balance, and the date it's due. You will need this information so you know how much you need to pay and when the bills are due are due. You can then decide which check they will need to be paid with.

• Gather your pay stubs

You will need to know how much your checks are and the date you will receive them. You should have this information for the entire year because it's a good idea to set your budget up for the year.

• Organize Your Bills By Due Date

The third step to learn to budget money is to put your bills in order by due date, starting with the one due at the end of the month on the bottom and work your way to the beginning of the month on the top. If you have bills that you don't receive statements for, use a file card and list the business name, monthly payment, balance, and due date on the card.

• Add The Information To A Spreadsheet

Once you have the bills in order you can start adding them to your spreadsheet. You will need to remember that you have to incorporate the bills into each check. So if your check is $500, you will need to include the bills that are due before the next check that total around $500. You will also need to include groceries, gas, and any extras that you have. If you are not familiar with using spread sheets, you should consider taking a quick course on the topic. Spreadsheets are practical and helpful tools you can use to learn to budget money.

Once you are done with your spreadsheet, you will have a great start to your budget. You will need to review it again. Look at the left over dollar amount for each check. If you have extra money you can either leave it in your check book or you can add a line and put it in a savings account.

Creating a budget is important for anyone. It gives you an idea of the money you are spending and it will help you make sure you pay all of your bills each month.

Article Source: http://www.wahm-articles.com

Darlyn Burkle of www.I-Choose-Us.com, offers resources to show women how to survive a depression and thrive through the financial crisis. The 52-week Money Saving Toolkit helps women save and earn extra money. It covers practical money saving tips for saving on food, utilities, mortgage, gasoline, entertainment, college education, travel, gift-giving, and more.

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