Get Control of Your Money!
Gaining control of your money requires telling your money what to do instead of letting your money do whatever it wants. There are a countless number of businesses, banks, retailers, people, family members, criminals, etc. that are willing to take care of your money if you don't have a plan for it. In order to gain control of your money you will have to learn how to create, follow, and live by a budget
When you plan on driving to a new store, restaurant, friend or co-workers house, do you leave the house with no clue on where you are going? Of course not, we get the address and quickly enter it into our favorite mapping service and get directions. Why not have a plan or directions for your money?
What Average Do You Belong?
When I started on my wealth journey I spent a lot of time reading on how people became wealthy. During my search I found the wealthy plan out what their money is going to do for them and where that money is going to go and knew why it was going there. In many cases planned out weekly, monthly, and yearly. In Thomas J Stanley's book The Millionaire Next Door he found that millionaires spend over 8 hours per month on there personal finances. Compare this to the amount of time that people spend glued to social media. According to Global Web Index the average person spends 1.7 hours per day on social media sites. What is more important to you? Wealth in retirement or the millions of selfies and cat pictures that add zero value to your life?
Start you budget and get control of your money now! It doesn't take long, and it isn't as painful as it seems. It doesn't require you to live on rice and beans. It doesn't require you to sacrifice to the point you hate life. It does require you to take action for your money and take control of your money and in turn take control of your life.
Tell your money what to do, Get a Budget!
“If you don’t know where you are going, you might wind up someplace else.” - Yogi Berra
Budgets are frustrating to make and take persistent effort to stick with. Everyone that has an income and bills attempts to keep a budget, budgets are a necessity. Either you keep a budget in your head, written down, in a spreadsheet, or an App. If you are keeping your budget in your head how successful are you at sticking to your budget? If you were like me it was an epic failure and you continuously over spend and under earned each month. This failure didn't appear at first but after years the debt piled up and the problem became apparent. Sound familiar? I denied my failure too. For years.
Budgeting in your head doesn't work. Thankfully technology has advanced and Real-Time budgeting and tracking of our budget is possible. Apps like Mint, Every Dollar, and You Need A Budget you can build your budget every month and track where you are every day, hour, minute, second... You get the idea.
Start Your Budget Now!
Where to Start with your budget? Pull out a sheet of paper and lets begin. The best place to start with you budget is to start with your Income. On the top of the paper write down "My Budget" and below that write down you monthly take home income(after taxes & withholding). Put a line under the income and we will start our budget categories.
Budget Categories
The main categories for the budget will consists of life's necessities, your needs to produce income, debts, and lastly wants. It is important to start your budget with the basic needs of life. Number one is to have a roof over your head and the utilities to keep warm or cool if you are in the south. Have electricity to keep the lights on and running water to cook and stay clean. Along with the shelter you will need food to keep up your energy and insurance to keep you out of financial disaster. Take it from
me, getting into a position where you need insurance and don't have it will devastate you financially. After your basic needs are taken care of you will want to ensure that you allocate the appropriate amount to your needs to produce an income. Transportation, clothing, and grooming all fall under this set of needs and should be maintained to support your income. After ensuring you protect your income you need to pay your personal debts. Before you can play you have to full fill your obligation to the people you owe money to. You borrowed the money, you must now pay it back, and pay it back FAST! The faster the better. The more you can put towards paying back your bad debt the faster you can start building wealth and living the live that you truly deserve. Last but not least you can use the rest of your budget for your wants.
Life's Necessities
- Saving(cash is key to building wealth)
- Shelter(rent and mortgage)
- Utilities(heat, water, gas, electricity)
- Food(groceries, lunch at work, snacks)
- Insurance(medical, auto, life, renters, home, etc)
Needs to Produce Income
- Transportation(lease, auto loan, gas, maintenance, inspection/registration, etc.)
- Clothing(dry cleaning, replacement clothes, etc.)
- Grooming(hair, nails, shaving, etc.)
Debts
- Credit Cards
- Student Loans
- Personal Loans
Wants
- Personal Spending
- Recreation & Entertainment
- Toys
Simple Budget Calulator
Try the budget calculator at SmartAsset.com
Simple Budget Worksheet
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