A good spending plan

[stella7]

Its very essential to come up with a good spending plan and here are some of the few basics one can use,



1.Determining how much money you and your family receive each month. Pay stubs, deposit records, and other records of income will help complete this step.


2.Determining how much money you and your family spend. List your expenses and don’t forget to include the items from your spending diary. If you have a checking account, refer to canceled checks or your account register. If you use a credit card, review six months’ worth of your statements and average the total amount spent over that period. Include receipts or invoices for items you pay every three, six, or 12 months, such as car insurance. For weekly expenses, such as gas, multiply the amount by four for a monthly total.


3.Comparing the income with the expenses
Add up your income and expense lists. Compare the two. Do you have enough money to pay all your expenses? Great! If you don't, see Setting priorities.

4.If you have money left over at the end of the month after paying your expenses, that’s even better. Now you can start paying yourself first by putting that money into a savings account.


5.Setting priorities
If you’re outspending your income, or if you're just breaking even, you probably need to make some changes. Simply put, you need to either spend less by cutting your expenses or boost your income.

[mamab]

Very succinctly put. Easier said than done at times, though. If it was as easy to do the things in the list, there wouldn't be debt counselors.