Budgets

[moldyhands]

i mentioned this in the Chapter 1 thread, but i thought i'd make an entirely new thread about it. who here has a planned budget? how often to you reevaluate your budget? i honestly think that if you're at a point where you're living even close to paycheck-to-paycheck, you NEED to have an established budget.

personally, i reevaluate my budget anytime my income changes, or i am thinking about a big purchase or taking on a new monthly payment of more than $50 a month. in order to make an actual budget you should track your expenses for a month. make sure to note expenses that are unusual, and build in an expense category for unusual/one-off expenses. it's amazing to see where your money is actually going. to think, i actually spend that much on alcohol is awesome!!!

the end product should be how much you expect that you'll be able to put into savings. but you have to estimate heavy. for instance, for eating out, i estimate i'll spend $250 a month, but i usually only spend $200. drinking? another $250, though i probably spend again, only about $200. this basically allows me to cover all my expenses, and if i have a month of light drinking or light eating out, i'm just pocketing unexpected cash. then there are fixed expenses such as rent, car payment, etc. really, until you have a handle on where your finances are, and where you can save and where you can afford to spend more, you can't successfully create any goals.

[TNathe]

good post moldy! I agree 100%. Know what your income is doing ALL OF THE TIME, and you wont be surprised when you go to the ATM and find out you have $10 left in your account and you start second guessing whether or not you should have went to the movies last night then out to the bar.

[Amortized]

budgeting is essential! I have yearly and monthly plannned out for business, monthly and weekly for personal. gotta have a budget, if not you're gonna be lost half the time, if not more.

[number_2]

i should look into this. i don't have any sort of income outside of savings at the moment, so i don't know if it's even possible.

[moldyhands]

i should look into this. i don't have any sort of income outside of savings at the moment, so i don't know if it's even possible.
the lower your income, the more important it is. budgeting is managing your expenses, not your income. so if you really don't have income, it's more essential to manage your expenses than it is for someone making 6 figures.

[TNathe]

if you're only drawing money from your savings then you DEFINATELY NEED TO BUDGET, as you have no means at this moment to recover from a bad judgement.

EDIT: beat me to it Moldy. But he's right.

[Mazda2ndgen]

Would anyone mind posting up their budget? Or just what their totaly budget amount is per month?

I am just trying to compare my budget to others to see how I am doing.

Please list How many people the budget is for, house/apt, or any car payments

[number_2]

i'd be interested in that sort of stuff as well. although i'm still a little confused. what's the point of a budget if you don't have an income barrier to worry about remaining within? let me make it clear, i'm a rather frugal human being (my dad was the cheapest motherfucker alive). i spend little money on anything other than necessities. but it's not like i can just ensure that my expenditres don't exceed my income... what's there is there. i know budgeting is important and i'm a big advocate of living within one's means (goes back to the way i was raised), but i'm stumped when it comes to applying those values to my own situation.

[Amortized]

it's more essential to manage your expenses than it is for someone making 6 figures.

I aggreed with everything except this last line. Somebody like myself who has yearly 6 figure expenses NEEDS to budget just as much if not more than the person with little to no income. I lived with little to no income for quite some time and rarely made budgets, just gotta be resourceful.

[_Charles_]

Would anyone mind posting up their budget? Or just what their totaly budget amount is per month?

I am just trying to compare my budget to others to see how I am doing.

Please list How many people the budget is for, house/apt, or any car payments


It varies depending on your situation. Most banks agree that roughly you should not have more than 45% in debt. That's Mortgages, and CC's etc. That's 45% of your GROSS earnings (before taxes). Well, I'm @ 29%, so I should be rich, right? NOT! I have daycare ($560/mo) that eats into my budget, as well, as other expenses related to my son. I also have insurance on 3 cars, 2 jet ski's and a trailer, and life insurance.

BAsically, if you want to help creating a budget, and really want to know how much you are truly wasting, than I suggest you buy a book called "The Budget Kit" by Judy Lawrence. It is an awesome book. I was going to cover budgeting in the 3rd/4th chapter in my series. (I'm not rushing the series, I'm trying to space it out).

So basically, it all varies.

Charles

[Alan]

After about 3-years of living without one, I recently setup a simple budget spreadsheet in Excel. I setup all the formulas so that I can plug & play any income or expense changes. I'm fairly disorganized, so this was essential in working out my finances for purchasing my home and, more recently, saving for a downpayment on my car.

Prior to my budget, I lived paycheck-to-paycheck. Many times I'd over extend myself & have to dip into my savings just to pay my monthly living expenses. Ever since I set a budget for myself, I have yet to tap into my savings. Plus I feel more secure about my financial future. :)