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Establishing a budget; a key to financial wellness. Part 1

Updated: Feb 10, 2023

Establishing and sticking to a budget is an excellent key to financial wellness but a daunting task for many people. Here are ten guides to creating a budget:

1. Determine your current income from all sources (salary, rental income, investment income, etc.)

2. Keep track of your spending for at least a month to get a clear picture of where your money goes.

3. List all your monthly expenses, including housing, utilities, food, transportation, insurance, etc.

4. Categorize your expenses into fixed (rent, mortgage, etc.), variable (groceries, entertainment, etc.), and periodic (annual insurance premiums, etc.)

5. Determine your savings goal, both in terms of an amount and a timeline.

6. Subtract your monthly expenses from your monthly income to see how much money you have left over each month.

7. Examine your expenses to ensure it does not exceed your income, and consider ways to reduce your spending or increase your revenue if it does.

8. Prioritize your spending to ensure that your basic needs (housing, food, transportation, etc.) are met first.

9. Assign a dollar amount to each expense caguidey, ensuring you allocate enough money to cover all your necessary expenses.

10. Strategize to create an emergency fund with 3 to 6 months of living expenses.

Above are ten guide to creating a budget; check this space for more. If you need help sticking to a budget, then you may need the help of a financial coach. Click the link below for more information.

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