Master Your Budget Part II

Master Your Budget Pt. II
4-13-11


Well the Masters Golf tournament is over and it was great, if you like golf. So this week let’s try to finish off mastering your budget. We stated last week that personal finance was 80% behavior and 20% head knowledge. Our first step was to sit down with your spouse or an accountability partner and plan your budget. Our second step was to determine what is most important, such as food, clothing, shelter, transportation and utilities etc. Always pay the most important first, these are your necessities.

After you have determined how much you bring in and how much each item costs start allocating the money. Now once you set the budget it is the boss of you, so don’t steal form the gas category to get a cheeseburger and fries. Your goal is to have a zero based budget. A zero based budget means income and outgo should equal zero. Every dollar should have a place to go such as groceries, gas, blow money, savings etc. If you tell it where to go it will be there when you need it, as long as you stick to your game plan. Now here is a critical step, you MUST track what you spend. Most of the time we do not know how much to budget because we have never done it before, this is where tracking your expenses will help. When you track them it gives you an exact number so you can budget better. If you don’t track them it will be a guessing game every month. If you don’t know exactly how much to budget for some categories, you may want to fund it a little heavy, such as groceries and gas. The way gas prices go up they should have an odometer on the pricing sign. Don’t worry it’s easy to forget stuff like birthdays and children’s activities; you will get better at it as you go. One thing that sneaks up on you every year is Christmas and the Thanksgiving grocery bill, try not to for get them. Don’t worry; no one budgets perfectly every month. It takes about three months before you budget starts working out smoothly. I guarantee you it will not work if you don’t do one and track you’re spending. Once you get the hang of it you can do your budget in 20-30 minutes with no problems. Feel free to email me with any questions. Start to master your finances. Budget forms

Tim West
Go West Coaching