by mzPOTTER on June 18, 2010
Surely you’ve wondered more than once how you can do to make ends meet. Your income, which once seemed to be sufficient to cover your expenses and commitments, suddenly no longer reach you. The reasons why there is this situation can be very diverse, but can generally be reduced to have lost control of your expenses and debts that you probably have acquired can not cover.
In general, if you do not take a strict and regular control of your income and expenses, most likely you derailed in the search for better economic situation. It is of note that we live in a world all time great pressure to acquire and possess goods and services, advertising bombarding us every moment, and if you’re not clear what your real financial situation, it is likely you make wrong decisions regarding your money. [click to continue...]
by Ann Brown on November 7, 2009
Previously I said that a central issue in personal finances is to have an income and expenditure budget that allows us to plan and have some financial stability in our household economy.
Make a budget, however, can be a very difficult process if our revenues are variable which usually occurs when you have your own business and do not work for anyone.
In the blog Get Rich Slowly gives us two ways to make a budget when our income is variable.
1. The average method. This method consists of making an average of how much they’ve won the last 12 or 6 months and that my monthly income I’ll put in my budget to calculate what would be the balance with my expenses.
The problem with this method, as the author says, is that if one month I have zero income method does not help much because if not I will not have enough savings to balance my expenses. It could also be a decreasing trend in my income for several months.
2. The lowest income method. In this case there is an average it takes the lowest income I had last 6 or 12 months.
Based on that number I do my budget and if one month my earnings are actually higher than what acumulare to a savings account in anticipation of a sharp drop in my income.
This method is much more conservative and safer.
Either method is necessarily must make a budget to know where you stand and have no surprises of any kind.
by Ann Brown on October 25, 2009
Make a personal or family budget is not an easy task, requires belief in the need of having a budget and a lot of discipline to follow.
In the photo above comes from the website MoneyThird proposes a budget system based on the envelopes used to send postcards. As shown in the image the subject is simple, our monthly check should make an envelope for every need we have, by assigning a number to the envelope.
For example if, as in the example I make $ 1000 per month, hare an envelope for lunch and I’ll put the figure at $ 300, another rent or mortgage on my house and put $ 350 and so on until exhausting earn $ 1000 monthly.
The idea is to visualize a system where the money goes I’m making and power distribution of the best visual way using the envelope system. It aims also to avoid using credit cards and you only use cash or cash when making their spending as a policy to achieve financial stability.
Clearly, there are softwares that allow you to create quotes but it is sometimes hard to follow. This visual system is more practical and envelopes should perhaps be the first step you must take before going to a software.
Having a family or personal budget is important, we will order us to save money that will help us to accumulate the capital we need to develop a business idea that allows us to make more money or to prepare for our retirement and retirement.
