Create a Budget

 

Having issues saving money? Have you created a budget? If not, now is the time to do so!

It's hard to save money if you're not really sure where all of your money is going to each month. So, I would highly recommend taking a few moments and sitting down to create a monthly budget.

The first thing you will want to do is to figure out your monthly net income (that is the amount of money you take home after things like taxes or your 401k - your disposable income). If your monthly income tends to fluctuate, than you will want to try to figure out a monthly average for your net income.

Now that you have your monthly net income figured out, it's time to figure out your monthly expenses (this not as much fun). For this part, you will want to make a list of all of your known expenses and how much they are costing you each month. Your monthly expenses may consist of expenses such as but not limited to the following:

rent or house payment
electric and/or gas bill
phone bills (land and/or cell)
water bill
car payment
groceries
internet
streaming services or cable
insurance

The above list is just some expenses to think about, other expenses could include: holidays or birthdays, dental, medical, property taxes (paid monthly but something to keep in mind),  home repairs, vehicle repairs and gas for your vehicle (or transportation expenses), etc.... So, each month it is a good idea to budget in "miscellaneous" to help pay for unexpected expenses.

Finally, you get to take your monthly net income and subtract all of those monthly expenses and see how much money you have left over at the end of the month. If you find that you don't have any money left over and are actually owing money, it's probably time to start to make some changes.

You may want to cancel any subscriptions (such as gym or streaming services) that you don't need, look into less expensive insurance, get a roommate or find a less expensive place to live - basically cut back your expenses wherever possible.

Making some changes may be hard at first but will be so worth it in the long run. Also, once you have your finances under control and can start to afford more, than you can start to treat yourself again (which could be a good incentive to saving some money).