5 Easy Steps to Budgeting

One of the most common questions I get asked is, “How do I budget?” Many people have tried budgets…and failed! That leaves people frustrated and in turn, they say they will NEVER use a budget again.

Here are some things people equate with budgets: Restricting. Controlling. No Fun. Not Worth It…

In reality, a budget is nothing more than telling your money where to go. 

Here are 5 easy steps to budgeting:

STEP ONE:  Decide to decide
Until you decide that budgeting is crucial to taking your finances to the next level, you will always find a way to avoid this “unsavory” task. The very day that Jenn and I started budgeting was the very day that we started WINNING WITH MONEY! From this moment on, decide to live differently. Decide to not live paycheck-to-paycheck and in debt.

Decide to decide!

STEP TWO: Determine the income (take-home pay) you will receive during the NEXT month
The key work in Step Two is “NEXT”. Preparing a budget for money you’ve already spent is not very fruitful. A budget must be completed BEFORE the month begins and BEFORE the money ever even ARRIVES!

The best way to stop saying, “I can’t believe I spent my money that way” and “I wish I could have that money back” is to develop a spending plan BEFORE the money is received that month!

STEP THREE:  Enter all of your expenses for the NEXT month
This is where we get to actually spend our money on paper! So we have already determined our income for next month, now it is time to actually spend the money BEFORE the month arrives! The absolute best way I have found to input my expenses is to use real, actual expenses that will happen. NOT averages for the year. If you don’t know the actual cost, enter an educated guess based on recent spending.

If the expenses are not relevant to the next month, it is highly possible that you will consider the budget irrelevant for the next month!!

STEP FOUR:  INCOME – OUTGO = EXACTLY ZERO

YOUR INCOME IS LIMITED! If you bring home $3,000 during the next month and spend $3,208, your spending plan will not work! Where will the extra $208 come from? It will have to come from savings OR from debt – usually in the form of a credit card. If you spend more than you make, no matter how much you make, you WILL have to make that up somehow!

STEP FIVE:  Follow the budget!

Now you know all the steps. You have a spending plan for next month. Now is the time to live it. YOU told your money where to go now YOU make sure it goes there!

I’ve been able to see people completely break free of debt. I have seen people pay off their mortgages! I have seen marriages restored! I have seen the hopeless become hopeful!

Following a budget is about more than money. It’s about becoming FREE! Not being held by the chains of debt and despair. You will become financially free if you stick to a budget. This is a decision you will not regret.

Why not pull up a free budgeting tool and get started winning with your money today?

If you get paid monthly or have at least one month of expenses in the bank, use our Monthly Budget Form. If you are living paycheck-to-paycheck, use the Weekly Budget Form.

If you would like to learn more about how to budget, check out my book, I Was Broke. Now I’m Not. Click HERE to order!   

0% Balance Transfer Credit Cards

Do you carry a balance on your credit card from month to month? If so, you are likely paying hundreds, if not thousands, of dollars in interest year after year. You should consider transferring your balance to a 0% Balance Transfer Credit Card.

A 0% balance transfer credit card provides a way to eliminate credit card debt very quickly and can provide HUGE savings over keeping a balance on a high-interest card.

Many people look at 0% Balance Transfer Credit Card offers and wonder, “What’s the catch?” Is the interest rate really 0%? 

The answer is, “YES!” Many of these offers do, however, have a small transfer fee – usually around 3%. 

Example:

Suppose you transfer a balance of $5,000 from a card that has a 21.99% interest rate. You apply for a 0% balance transfer credit card. This offer comes with a 3% balance transfer fee, but it also provides 0% for 18 months.

Upon acceptance of your application, the 3% balance transfer fee ($150) will be applied to your balance on the new credit account making your total balance owed equal $5,150 ($5,000 balance that was transferred PLUS the $150 balance transfer fee).

Now comes the good part! You now owe 0% interest for the 18-month period – as long as you make all of your payments on time, of course. 

Let’s take a look at cost if you did not switch to the 0% balance transfer card. Assuming you made no additional charges and paid only the minimum payment due each month, you would have paid $1,162.70 in interest over the 18-month period!!

By taking 15 minutes to do a little research and apply for a 0% interest card, you can eliminate hundreds or thousands of dollars in interest and accelerate your debt freedom date.