Plan, Save and Spend for what mattrs to you.

Yeah, we know financial planning can be boring. But it’s like eating your greens. You don’t like how they taste, but you know you have to eat them because they’re good for you. The first step of financial planning and the key to financial success is to create a budget.

Contrary to belief, you don’t have to be a rocket scientist or even an accountant to be able to do this. It doesn’t even take up that much of your time. Here’s what a budget really does. It functions as a plan, guiding you to track where your money is going each month. As a result, it helps you have more control and freedom over your finances.

Here are some simple steps to create your own monthly budget:

The first step is to determine what your income will be each month. With a salary, you will be able to record a definite value. But if your income is irregular, you can just estimate it to the best of your ability. Later, you can adjust your budget as you get paid.

The second step is to write down all your fixed expenses for the month. These are the expenses you have to pay for no matter what, and include food, rent, utilities, and more. If you are not sure how much these amounts are, you can always look at your bills for the past couple of months and calculate an average.

However, as you know, fixed expenses are not the only ones you encounter. You also need to plan for seasonal or unexpected expenses, and keep some money aside for them, so that you can draw from this “emergency fund” when these expenses pop up. Write down your estimated irregular expenses and convert them into monthly amounts for your budget.

Next, think about your financial goals for the future. You may want to buy a house, take that long due trip to Spain, or start saving for retirement. The list is long and diverse. Of the income that remains after you subtract your fixed and irregular expenses, you need to put aside an amount of money each month devoted to achieving these goals and write this on your budget.

Finally, you can budget for adjustable expenses. These expenses are the ones that do not arise from necessity and include recreation, eating out at restaurants, and more. Once you have listed all your income, expenses, and financial goals, subtract them. If this final number is negative, you need to find a way to increase your income or decrease how much you spend.

With experience, you should be able to tally your budget so that your total income and total expenses are equal. That means you should know where every single dollar is going. Be sure to track your expenses. Initially, you will find that you deviate from your monthly budget plan. But that’s okay. Just strive to stick to your budget better each month. As you learn, Beemo will always be around to help!