Budgeting Guidelines

Keep your personal budget on track.

This is an overview of the recommended guidelines used by the financial community. Creditors use budgeting guidelines when reviewing and approving credit.

If your debt exceeds the financial communities recommended guidelines, then you have a higher risk of credit applications being denied. Plus, if approved, you will pay more interest since you will be perceived as a higher risk.

Getting, and keeping, your debt in line with recommended financial guidelines, is an important step in debt relief and credit recovery.

Use the following list to review the items in your budget:

Housing 35% - Mortgage or rent, taxes, repairs, improvements, insurance, and utilities;

Transportation 20% - Monthly payments, gas, oil, repairs, insurance, parking & public transportation;

Debt 15% - Credit cards, personal loans, student loans & other debt payments;

All other expenses 20% - Food, insurance, prescriptions, doctor & dentist bills, clothing & personal;

Investments & Savings 10% - Stocks, bonds, cash reserves, retirement, rental real estate, art, etc.

Balancing Your Budget To Budgeting Guidelines

Next to each item that is out of line, make notes as to why you think they are out of line with recommended budgeting guidelines. Be honest, be brutal, but write it down. It is the only way to ensure that you consciously accept the reasons for your debt problem so that you can fix it permanently. Remember, Debt relief is a temporary solution, only you can make debt problems disappear for good.

Use our free Money Management Worksheets to easily calculate how your household budget expenses compare to recommended budgeting guidelines.

Step Your Way To Debt Relief

These guidelines provide a basic outline of where you need to spend your money. If you find one guideline percentage to be more than you need, or less than you need for your personal situation, feel free to take from one to give to another.

Keep in mind, however, your priority should be to eventually get your debt budget down to, or below, the 15% recommended budgeting guidelines.

Track Your Spending

The first step in getting your finances fall to within the budgeting guidelines outlined is to track your spending, as much of it as possible. Not only will you be able to calculate your budgeting guidelines, but you will also know where your money is going, and what adjustments you need to make to get out of debt.

You have two choices when tracking your spending quickly and easily. You can use a paper-based system or a software-based solution. We have extensively reviewed both and found two products that stand above the crowd and both use the envelope system of budgeting to maximum effectiveness:

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Mvelopes makes it easy to create a budget and live with it.

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Getting The Answers You Need

Need help to get your expenses under control fast? Check this out.

Be sure and check out the various debt solution reviews, tips, and articles provided on DebtSteps.com:

Find Your Solution offers a comprehensive list of reviews to get out of debt once and for all. Get answers on bankruptcy, consumer credit counseling, debt settlement, money management, budgeting, loans and mortgages.

Debt Relief Tips & Articles to guide you on your way to financial freedom. Get the lowdown on dealing with debt collectors, handling money problems, understanding your credit, and more.