Personal Budget

How often have you muttered this phrase? Monthly? Weekly? Daily? Do you know where you money is going?

We often spend money without thinking. Credit cards have allowed us the luxury of spending without actually paying, until the bill comes, so the spending seems harmless. Fast food is a convenience and seems so cheap, so we tend to go through the drive-thru without giving a thought to the costs adding up. If you go to Burger King twice a week for a year, you could be spending upwards of $500. And we all love our coffee, especially the premium stuff. Buying that $3 cup of joe five days a week for a year will cost you almost $800.

With gas prices increasing and other costs for beating summer’s heat adding up, now is the time to once more review your budget.

Never done a budget before? Here’s how.

Keep track of every expense you make for a month, listing expenses from that fast food or coffee run to larger expenses. Even track when you take money out of the ATM. Keep all receipts. You really need nothing more high-tech than a pocket size notebook to write down expenses and an envelope to save receipts.

Then identify all of the unexpected or unusual expenses you may have – car repair, birthdays, weddings, baby showers, or medical. Don’t forget quickly approaching school bells and of course, the holidays will be here before you know it – so be smart and consider these expenses now. Of course, a really effective budget also provides for saving for emergencies and retirement, too.

You now have all of the tools to create your budget. Compare your expenses to the money coming in and search for ways to balance the two.

Tracking all of your purchases and expenses for a month isn’t as time consuming as you may imagine and the time taken may result in money in your pocket. You will have a way to see what you really are spending your money on, and it may surprise you. But it may help you to realize what expenses you can cut or reduce, so you can save money to pay off bills or enjoy a summer get-a-way.