The main task when creating a personal budget is not just to balance the debit with the credit, but to wisely distribute expenses so that in the last week before payday you do not have to borrow or live from hand to mouth.
How to Make a Monthly Budget
As a rule, the main part of the salary is paid not on the first day of the month, but on the 5th, 10th or 15th. Therefore, it will be more convenient to plan the budget not for a calendar month, but for the period from payday to payday, for example, from March 10 to April 9.
Income
First, you need to record all financial receipts to understand how much money you have. You should take into account all sources of income: salary, bonus, part-time work, money from renting out an apartment, etc. If your income is unstable, it makes sense to create a budget when you know exactly how much money you have, for example, on the day the money is received on your card.
Expenses
The first items of expenditure should be those that cannot be avoided. This list will look something like this:
- Groceries (including lunches at work if you eat in the cafeteria).
- Utility payments.
- Directions.
- Mobile communications.
- Internet.
- Household chemicals.
Naturally, the list of mandatory payments will be different for each person and each family. Travel fees may be replaced by gasoline costs. People with chronic diseases will take into account the costs of medicines. The same list will include loan payments, kindergarten fees, and so on. At the same time, traditional trips to the cinema on Saturdays and similar expense items are not mandatory.
e amount remaining after deducting mandatory expenses can be dealt with in two ways:
- You distribute money among entertainment, clothes and various pleasantries.
- You divide the remaining amount by the number of days in the month.
The first method is clear: you decide that you will spend 3,000 rubles on a movie, the same amount on clothes, and so on. The second method is worth considering in more detail.
Let’s say you have 15,500 $ left and there are 31 days in the month. This means you can spend 500 rubles daily. At the same time, mandatory expenses are already included in the budget, so this money is only intended for pleasant expenses or force majeure circumstances. Accordingly, if you spend more than this amount per day, you go into the minus, and at the end of the month you will have to tighten your belt. If you do not spend anything, then within two weeks you will save 7,000 rubles, which you can spend on something big.
How to plan a budget for the year
The annual financial plan will require regular adjustments for both expenses and income, so all columns in it need to be created in duplicate: forecast and actual figure.
Income
If you have a regular income
With a fixed salary, you simply enter your salary and other regular income in the income section. The only thing that will interrupt the usual course of things is vacation pay. Usually, before vacation, you are given money for the days during which you will rest, but then you will lose some amount in your salary. But in general, at the forecasting stage, especially if you are making a budget for the first time, it will be enough to use only the salary amount for all months.
If you have an unstable income
If your income is irregular, there are three ways to forecast your income:
1. You are confident that you will receive a monthly income sufficient to live on, although you do not know its exact amount.
Calculate your average income and use it for calculations. If you earn more than the projected amount in a month, move the surplus to the piggy bank. You will get into it if you earn less than the average.
2. You don’t have a steady income and you’re not sure what you’ll get.
It is better to take the minimum income as a basis for calculations. In this case, budget planning will become a problem with an asterisk, but there will be no financial surprises.
3. Part of your income is stable, but the exact amount of earnings is difficult to predict.
For example, you receive a fixed salary, and the presence of a bonus depends on many factors. Then it is worth planning a budget so that a stable income covers all essential needs, and you will spend on the rest according to the situation.
Expenses
When planning expenses, write down mandatory expenses in the columns of months: food, utilities, travel, mobile communications, household chemicals, and so on. Keep in mind that in winter, utility bills are higher due to heating, and for mobile communications, for example, in May, you will spend more, since you are going on vacation. These changes should be included in the budget.
Thus, the example shows that the heating season ended in March, so the last increased payment for housing and communal services is planned for April. A vacation in May is also reflected. The budget compiler plans to go to visit his grandmother for three weeks. The tickets have already been bought, so there is no point in taking this expense into account. Housing and communal services are calculated according to standards and will not change.
At the same time, our hero will not spend money on travel for three weeks. And he has cut his food expenses in half: he will eat at home for a week, and will also take on part of the food expenses from his grandmother.