Do you have specific financial goals or do you spend most of your time daydreaming about what it would be like if you had extra money every month? The fact is most people live paycheck to paycheck and find themselves in a never ending cycle of wondering where all there money went. The way out of this financial nightmare is to make a personal budget and take back control of your money.
Making a personal budget is the first step to regaining control of your cash flow and it allows you to actually start meeting your financial goals because it gives you and your money a plan.
Becoming debt free or saving money for a down payment on a home or new car are all goals that can be met simply by making and following a budget.
Almost all successful people and business have a money plan that shows that at a moments notice exactly what their money is doing. This gives them complete control of their finances and allows them to make smart decisions with their money. If a cash flow budget works for wealthy people and fortune 500 companies then it can work for you.
Many people talk about setting up a budget but in many cases they do not follow through with their plans because they think it is harder then it actually is. But if you follow these 3 personal budgeting strategies you’ll find that creating a cash flow plan is actually easier then you may think.
1. Income – As hard as it is to believe many people do not actually know how much money they make on a monthly basis. This step is just as important as the other three because your money is your most valuable wealth building tool and you need to know how much is coming in so it can be allocated properly.
2. Expenses – This is the part everyone hates; figuring out your monthly expenses. And for good reason because this shows exactly where your money has been going and it’s not always pretty because you need to write down every expense you have. From your mortgage to that soda you bought at the convenience store.
3. Set your Financial Goals – With your income and expenses in front of you start looking at ways to make those goals happen.
Once you have this information in front of you you can figure out how much money you have coming in and not only how much is going out but where it is going. You can then start tweaking your expenses as you put together a plan to start working towards your goals. Instead of money just leaving your accounts with no direction your new budget allows you to allocate where your money is going before you ever spend it. In this way you can start paying off debt, save for a rainy day, and start investing in your retirement and future. So when it comes time to make personal budget there is never a better time then now to get started.
