It seems like most of us are struggling financially these days; there just simply isn’t enough income to outweigh the outgo.  In addition, many people are deathly afraid to create a budget because they think that it means they won’t have anything left over for the extras when the budget is in place.  That’s simply not true.

Creating a budget does not mean you swear on a stack of Bibles that you’ll never spend an unaccounted dollar again.  It simply means you know how much money you are bringing in each month and how much you’re spending.  That’s all a budget is.

To determine what your income is, grab a piece of paper and start a list of where your money comes from.  For instance, you’ll want to count your wages, any financial assistance from Social Security or alimony payments, and any other source of money you’re taking in each month.  Next, in another column, list all your expenses.  This should include rent, food, utilities, transportation, taxes, etc.  Again, the list should include monthly amounts so you’ll know what you’re taking in and what you’re paying out.  Now, subtract all of your expenses from your income.  The amount left over is what you’ll have for doing extra activities during the month.  If there is nothing left over, then your only choice is to look at how you can reduce your expenses.  This may mean finding an apartment that costs less, not paying for cable tv until you’re out of debt, or other debt-reducing moves.  While this may seem to be an extreme measure to you, believe me, it’s worth it when you’re able to get out from under all the pressure and stress of having creditors call and knowing you can’t meet your financial obligations.

When you get things under control enough that you’re meeting your expenses with money left over at the end of the month, then start a savings account.  Putting a little away for emergencies is a wise move that can be a major move toward reducing stress in your life.  It’s recommended that you have an emergency fund in the bank that would cover your costs of living for at least 2 to 3 months.


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