Over at Mic.com they have a helpful article entitled, “Your 5-minute guide to budgeting“.
The article gives some useful tips to get you started on the road to setting up your own budget. The article starts out with a gem of a quote:
Budgeting isn't a punishment for not being born wealthy.
That quote really struck me because so often we think of budgeting as something we HAVE to do, not something we want to do.
It is up there in the same realm of having to pay taxes, meet the in-laws or writing out a check for the mortgage. You don't want to do it, but if you don't you'll be in an even bigger heap of trouble.
The article goes on to talk about the basics of budgeting:
Step 1 – Figure out where your money is going out: Find out what you're spending your money on from normal monthly bills like mortgages and utilities, to more sporadic insurance and tax payments.
Step 2 – Figure out what money is coming in: Tally up your income from your salary, ebay income or part time jobs. Once you've done that you can better begin to set up budget categories and normal expenditures, and keep them within a reasonable amount so that you can also fund savings, emergency funds, and so on.
Step 3 – Find some expenses to cut out: Every budget has some fat that can be cut out. Whether it is over the top spending on restaurants or entertainment, to cable dues and gym memberships, there are always areas that you can cut down. Find a few and make the cut – no matter how painful it might be!
Step 4: Build a budgeting habit: Make it a habit to constantly keep track of all your expenses, extra income and any changes that might be happening in your spending. Find out how you're doing on your budget, and adjust as need be.
Lots of great tips in the article, so go check it out!