How to Create a Budget: 4 Money Saving Tips

When it comes to your finances, do you use a budget? If not, it’s high time to put on your big girl pants and start one. Budgeting will save you (and your family) plenty of headaches, save more money, and plan for your future.

Here are 4 money saving tips – and how to create a budget.

1. Calculate income after taxes

If you take home a regular check, it’s time to stop calculating your budget based on your gross salary (the amount you get paid before taxes, benefits, and retirement). Make sure that you are using the net amount that you are actually taking home.

Furthermore, if you end up owing taxes at the end of the year, consider amending your W-4 with your employer to ensure enough taxes are taken out throughout the year.

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2. It’s all about the spreadsheet

If you don’t use a spreadsheet to track your finances, this is the time. Start now! Personally, I like using Google Docs, so I can access my budget any time, any where.

Include all income and expenses in your spreadsheet for each month. Then, double check that all incoming and outgoing money is being tracked exactly within your budget.

3. Track all expenses

Incorporate all recurring monthly and annual expenses into your budget. This should include things like mortgage or rent, phone/internet bills, utility bills, any debt bills, and additional amounts set aside for monthly spending (gas, groceries, and fun) and savings.

If you’re a Dave Ramsey follower, you know it’s important to have a “zero-balance” budget. That means that after all income and expenses, your budget for the month should equal zero. If you have extra income or extra funds after expenses, that money goes toward debt and savings.

4. Adjust as needed

Money is a fluid substance and is meant to come and go. Use your budget to track everything closely, but be open and willing to change based on needs.

If you have a new expense or have to pull out a lot of money from savings for an emergency, fall back to your budget to feel good in knowing that you know exactly how much you have – and how much you can save going forward.

Do you already have a budget? Where do you see success and where do you struggle with it?

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