Many people spend their little income haphazardly without any planning and end up getting broke before month-end. They then borrow to make ends meet and end up with more problems that they fail to repay their debts promptly.
However, this is not a prudent way of managing your personal financial affairs. Planning your personal financial affairs through prioritization of needs and budgeting income and expenses is the best way to achieving success in managing your financial affairs.
It is important first to assess your financial needs in the short, medium and long term. What are your financial objectives? What do you want to achieve in the course of time? Do you have any targets? What is your short, medium and long term needs? List all of them down.
Next categorize income and expenses on a monthly basis. Then prioritize expenses into most important, important and most important. You can use any other weighting or prioritization formula that works best for you.
After this assess costs based on consumption per month. Put figures to the expense items. Then write down your income sources and the amount you earn per month from them. List the income on the left and the expenses on the right. Add up income amounts against expense amounts and find the difference to determine surplus or deficit.
Once you have added and reduced items and figures several times and you are finally satisfied with the results, type your figures on a computer spreadsheet or word processor table and save it. You may also print it and file it for regular reference.
To make it work successfully for you, you must vow to stick to the budget. Any deviation must be absolutely necessary and funds should be made available separately to meet the extra expenditure. Where no funds are available, some cutbacks or borrowing from other expense votes. You should ensure that you refund any funds borrowed from any expense votes to enable the votes to be expended.
To be frank, most people would want to spend more and more irrespective of their financial ability. However, arbitrary unbudgeted spending may be hazardous to your financial health.
About The Author
Abdallah Khamis Abdallah is a freelance copywriter and ghostwriter. To learn more about how you and your business can benefit from viral and credibility marketing solutions visit his website at: http://www.qualitywritingsolutions.com, http://www.qualitywritingsolutions.com
Next to our physical health most of us are primarily... Read More
Saving for a Down Payment is hard work, so it's... Read More
In this age of information, keeping track of your finances... Read More
Finding a stable and secure income that will come year... Read More
The judge had to ask the question, and we had... Read More
Chapter 7The potential chapter 7 debtor should understand that a... Read More
Things are so expensive these days. We seem to be... Read More
Just about everyone has a checking account. Checks present easy... Read More
Identity theft is a serious crime that continues to grow.... Read More
Are you a check fanatic? Don't worry, you aren't alone.... Read More
You've analyzed your past expenses, put them into spreadsheets, loaded... Read More
I've been sharing the following idea with people for a... Read More
**If it's Spam, it's a Scam!- If it sounds too... Read More
Confused about whether you can contribute to a Roth IRA?... Read More
If you're like most people, your personal financial records are... Read More
The price of gas continues to climb, and with continued... Read More
Future financial success is not a guarantee that any one... Read More
With the A-level results coming out, the long wait for... Read More
Women have a love/hate relationship with money. Most of us... Read More
The cries are heard from the distance, "I need help... Read More
Would you be interested in freeing up 10% to 15%... Read More
If you were to ask 100 women "What would you... Read More
As a parent you are bound to face a few... Read More
It is possible to eat a healthy, balanced diet without... Read More
The gas that we fill our tanks with every week... Read More
Creating a budget can be a very difficult task. Although... Read More
Have you seen the recent article on a new "green"... Read More
It doesn't take much for you to get behind on... Read More
As the saying goes: "Buyer Beware". If you see ads... Read More
Here are some tips that can help you save money... Read More
If You Have an Existing Account and 5 Minutes, You... Read More
Christians are called to be good stewards of God's resources.... Read More
It is estimated that we, as consumers, waste an average... Read More
Everyone needs to maintain their lives. What I mean by... Read More
Did you have a piggy bank when you were a... Read More
For months, we were trigger-swipe happy, putting our groceries, clothes,... Read More
Things are so expensive these days. We seem to be... Read More
You should thoroughly consider your business needs when selecting a... Read More
I'm still amazed every time someone comes to me complaining... Read More
Vacations Made Easy: Buying a Florida Investment PropertyA relaxing beach... Read More
Your food budget is the most flexible area of your... Read More
Each of us knows how to spend money, but do... Read More
Most consumers are aware of the importance of their credit... Read More
Traditional checks probably won't disappear anytime soon, but processing checks... Read More
Between 15 - 20% of people in our country (UK)... Read More
Well, dang! From what I've heard and read, it looks... Read More
This investment retirement account (IRA) is useful to you as... Read More
ID theft is a major consumer concern, though there is... Read More
When you received an energy (heating) bill last winter, were... Read More
Shopping for groceries is an inevitable fact of our ever... Read More
Personal Finance |