Financial Awareness Questions

We prepare for you basic questions and answers about financial awareness :

How do I create a budget?

This is probably the most frequently asked questions. The foundation for a budget relatively simple and can be done in several ways. Many people think that the end of the budget did not know how to do it properly. However, the waiting is the worst course of action. A budget is ever perfect (only your best estimate of its income and expenditure), so do not worry if it is not perfect. A budget is the power of your finances and be used as a process to get there. Therefore, the first step and not let the need for a full budget on the road. The best thing is that the budget can be updated on the road. ( India )

It is a budget for a month or a year?

Initially, I suggest doing so for years because there are expenses that occur only once or twice a year as insurance premiums and gifts. Other costs are higher in some months (such as electricity for air conditioning in summer and natural gas or heating oil in winter). Therefore, these costs in the factor of the whole year, so you can save for these costs throughout the year. In this way, your check is not in January to all public services and credit card bill with money saved for the grocer. After creating the budget for the year, they may break a months to who knows how much you should spend versus savings have enough saved for months when there are costs (eg for public services in January, taxes and bills credit card ).

What about those who say that the budget is not necessary?

Some people say not to worry about creating a budget because a budget is never exact, because of unforeseen expenses and because people hate so much anyway. Using this logic, I think we can neglect the cleanliness of my house and eat my vegetables. There are things that we do not like to do, but they are important. Therefore, if you're tired of having money problems and stress about money, the budget can be very informative about where the money goes.

Should I automatically save first, then spend the rest?

I know many people like this philosophy and has worked for some. In my opinion, the principle is based on the belief that people can not control what they spend their money. That is what this method to automatically save money in a special account that does not touch, unless you have an emergency. Personally, I do not, because it prevents people from more of your money without being able to say who will never be able to control their costs, so do not worry about saving automatic. Automatically backup is when you control their costs by creating a budget for how they spent the rest of his money. Alternatively, registration can be found through their broken furniture or car accident last until your next paycheck, as it is not having a plan of maintenance funds currently available where the rest of the check payment has already been spent for the month.

Never had a budget and was never in trouble, so I need a budget?

A budget is becoming more aware of what you do with your money. If you've never had problems before, may already be aware of your income versus expenses. However, if you want a little more of what they are, looking where they spend their money in May provide some clues. It's like wanting the desert, giving him yet because they want to gain weight. If you watch your diet (eating habits) May be able to cut some fat from the meat you eat to meet on an occasional desert. As for your budget (patterns) can show you places where you can save some money for the holidays that you could not take because of not having enough money. May you have never been in trouble for not having a budget, but you May not have more than what we could have either.

What if my income or expenditure varies?

A budget is the best estimate of what might happen. If your income varies from year to year, in May, you want to be a little conservative, if there is an economic downturn that makes your income is below normal. The budget process is not perfect yet more of a plan of plans for your money. By making a budget, you understand that if you can reduce your income is below expectations or unexpected increases in costs, such as articles of a medical emergency because it is their process, and that spending on paper. Things never work. However, if you do not know where your money goes, you do not know how to adjust if necessary. The worst thing to do in an emergency panic (race to create a budget or looking to find the money to pay bills) and that stress will be diverted to where you want to go . Therefore, it is better to have your financial (budget) was created so that you have only to refer to emergency situations to see where to go.

What if I am not good with numbers?

With computers these days, you really do not need to be good with numbers. This is just a resistance to take control of your budget.

A budget that makes me more money?

No, you'll feel more power over what you spend. And you can spend less when you are aware of your spending decisions, which allows you to keep more money they already have.

And if all that I can cut a medical emergency exits and therefore the budget goes to the window because there is nothing to cut?

A budget can be very useful in this situation because it is a point of negotiation with creditors and medical practices. If you demonstrate that you are doing everything they can to control your spending, you May be able to develop a payment plan of some sort. However, if you have no budget, there is no way to know if you have more money to pay them. Therefore, you are called to work to repay their free time. This is no guarantee that they will work with you. However, those who are willing to help their clients who took the first step toward collaboration with customers that goes far in its decision to help.

What if I do not have time because they work too?

A budget is only a few hours a month to create and control. Take a couple of hours you May be able to release the funds so you do not have to work so much overtime. So, the money works for you instead of always working for money.

What happens if too many unexpected things that I can not plan where is my money?

Part of the issue is not that the planning of the semi-recurring items, such as maintenance and repairs are made that people who are struggling to find money. Apparatus and break your car, to plan. If you have a budget that is so tight that nothing is left for the maintenance of a fund, which continues to ask how you can get enough money for the distraction of work (overtime or other or promotion) to get additional funds. The time to plan is when you're doing a budget to ensure that their fixed costs (such as mortgages, utilities - for example, cellular phones, car payments, etc.) are not too big that they have nothing at all.

Is it necessary to follow all the money?

The increased budget is the most likely will do so because there is no margin for error. I set my budget to have some flexibility, because I do not spend more time to find things you need. However, I am also aware of what you spend my money. I know that if I went to dinner, after months and spend $ 50 or more for dinner, eating out of my depth is about $ 600. If I have $ 20 or so, no big problem because I have some flexibility in the budget and I'm probably $ 15 to $ 25 in another place that still allows it. If I am at $ 200, that's another story that I must be aware to adjust to him.

Can control expenditure in a notebook to be beneficial?

People say that you will be surprised when you see how much you spend on coffee in the morning, writing in a notebook. However, there are other ways to be more aware of my expenses that have worked best for me. For example, if I get a cup of coffee, 3 times a week for $ 5 is $ 750 per year (50 weeks factoring 2 weeks holiday X 3 X 5 $ = $ 750). If I realize what I could determine with relative ease, without a notebook. For me, I found myself thinking of my expenses (instead of writing it down) helped me to begin the process of awareness of what I do now makes me more able to take me even in the act of spending to ensure that expenditure is more reflective rather than impulsive spending. Although track my expenses in a notebook that does not work for me because I'm crazy, my wife is that tracks your spending with a laptop because it is geared more towards me. Method can work well. Personally, I believe that my method allows me to see the big picture, rather than easier to stagnate in the details so you can be easier to adjust my budget for when things do not go as planned.