The battle for financial freedom isn’t fought on an equal footing. Obtaining a comfortable quality of living looks to be either unattainable or unrealistic, no matter how you spin it. Many people are paying a lot of money these days to seek advice from professional financial planners on how to get their finances in order. But, let’s face it, while a financial planner can show you how to prioritise your spending and consolidate your debt, surely there must be a method to organise your finances without consulting a professional? This article was written to assist some individuals in realising that they may properly organise their finances from the comfort of their own homes.
The key goal when it comes to budgeting is to make things as simple as possible. Nothing is more dismal than getting so far into it that there is no way out. Whether you’re trying to get out of debt or simply want to set away a little more spending money each month, the more basic your planning is, the better the outcomes you’ll get. From the beginning, you must be practical. To begin, I’ll take a single-income family as an example. To begin, determine your monthly net wage. If you’re self-employed or don’t get paid on a regular basis, always calculate the worst-case scenario, or the smallest amount you could be paid. Then go over your monthly bills and make a list of the ones with a fixed amount. Make the same calculations for all other bills, but this time use the worst-case scenario to estimate how much they will cost. Total it up and subtract it from your total net income.
Then there are the monthly fees that you may have to pay. Gasoline, car upkeep, public transportation expenditures, meals, and so on are examples of these expenses. Make a note of all the minor expenses you expect to incur over the month. Even things you don’t think you’ll need. Make a list of specific spending money rather than a list of generic spending money. If you’re unsure, add a little extra to the totals so you can adjust it later. Subtract your total from the money left over after you’ve paid all of your bills. If you’ve gone into negative digits, don’t panic; we’ll get you back on track.
Any money left over after you’ve totaled your monthly expenses is obviously your profit for the month. If you’ve run out of cash or are in debt, the next step is to reduce your expenses as much as possible. Isn’t it easy to understand? Remove any ancillary expenses you don’t believe you’ll require. And try to spend as little as possible on any expenses you know you’ll have, such as meals and gas. Is spending so much money on them really necessary? After you’ve spent all of your money, your monthly objective should be to save at least $50. After a few months, all of that extra small cash adds up to a substantial number!
If you have multiple sources of income, follow the same steps. Put some money in the petty cash bucket. Everyone recognises that there will always be expenses that are unforeseen. In truth, knowing that you have enough money to cover any unforeseen expenses is the foundation of a comfortable lifestyle.
To summarise, if you want to take your time, you may do all of this on a piece of paper, or you can use an Excel spreadsheet. The most time is saved by using a Financial Planning software tool, where you enter the figures and the programme develops an automatic monthly planner. Remember to keep things as basic as possible, no matter which road you choose. If you keep to a plan, the pressure on you will lessen. What could be better than a relaxed way of life?
